Quarterly Report • Aug 31, 2011
Quarterly Report
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Half Yearly Report 31 August 2011
Investec Structured Products Calculus Capital
| Investment Objective and Policy | 1 |
|---|---|
| Investment Managers | 2 |
| Financial Review | 3 |
| Chairman's Statement | 4 |
| Investment Manager's Review (Qualifying Investments) | 6 |
| Investment Manager's Review (Structured Products) | 8 |
| Investment Portfolio | 11 |
| Interim Management Report and Directors' Responsibility Statement |
13 |
| Condensed Income Statement | 14 |
| Condensed Reconciliation of Movements in Shareholders' Funds |
16 |
| Condensed Balance Sheet | 18 |
| Condensed Cash Flow Statement | 21 |
| Condensed Notes to the Accounts | 23 |
| Company Information | 28 |
The Company's principal objectives for investors are to:
It is intended that approximately 75 per cent. of the monies raised by the Company will be invested within 60 days in a portfolio of Structured Products. The balance will be used to meet initial costs and invested in cash or near cash assets (as directed by the Board) and will be available to invest in Venture Capital Investments and to fund ongoing expenses.
In order to qualify as a VCT, at least 70 per cent. of the Company's assets must be invested in Venture Capital Investments within approximately three years. Thus there will be a phased reduction in the Structured Products portfolio and corresponding build up in the portfolio of Venture Capital Investments to achieve and maintain this 70 per cent. threshold along the following lines:
| Average Exposure per Year | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6+ |
|---|---|---|---|---|---|---|
| Structured Products and cash/near cash | 85% | 75% | 35% | 25% | 25% | 0% |
| Venture Capital Investments | 15% | 25% | 65% | 75% | 75% | 100% |
Note: the investment allocation set out above is only an estimate and the actual allocation will depend on market conditions, the level of opportunities and the comparative rates of returns available from Venture Capital Investments and Structured Products.
The combination of Venture Capital Investments and the Structured Products will be designed to produce ongoing capital gains and income that will be suffi cient to maximise both annual dividends for the fi rst fi ve years from funds being raised and an interim return by an interim return date by way of a special dividend or cash tender offer for shares. After the interim return date, unless Investec Structured Products are requested to make further investments in Structured Products, the relevant fund will be left with a portfolio of Venture Capital Investments managed by Calculus Capital with a view to maximising long-term returns. Such returns will then be dependent, both in terms of amount and timing, on the performance of the Venture Capital Investments, but with the intention to source exits as soon as possible.
The portfolio of Structured Products will be constructed with different issuers and differing maturity periods to minimise risk and create a diversifi ed portfolio. The Structured Products may also be collateralised whereby notes are issued by one issuer (such as Investec Bank plc) but with the underlying investment risk being linked to more than one issuer (as approved by the Board) reducing insolvency risks, creating diversity and potentially increasing returns for shareholders. If the Company invests in a collateralised Structured Product, the amount of the exposure to an underlying issuer will be taken into account when reviewing investments for diversifi cation. The maximum exposure to any one issuer (or underlying issuer) will belimited, in aggregate, to 15 per cent. of the assets of the Company at the time of investment. Structured Products can and may be sold before their maturity date if required for the purposes of making Venture Capital Investments and Investec Structured Products have agreed to make a market in the Structured Products, should this be required by the Company.
The intention for the portfolio of Venture Capital Investments is to build a diverse portfolio of primarily established unquoted companies across different industries. In order to generate income and where it is felt it would enhance shareholder return, investments may be structured to include loan stock and/or redeemable preference shares as well as ordinary equity. It is intended that the amount invested in any one sector and any one company will be no more than approximately 20 per cent. and 10 per cent. respectively of the Venture Capital Investments portfolio (in both cases at the date of the investment).
The Board and its Managers review the portfolio of investments on a regular basis to assess asset allocation and the need to realise investments to meet the Company's objectives or maintain VCT status. Where investment opportunities arise in one asset class which confl icts with assets held or opportunities in another asset class, the Board will make the investment/divestment decision.
Under its Articles of Association, the Company has the ability to borrow a maximum amount equal to 25 per cent. of the aggregate amount paid on all shares issued by the Company (together with any share premium thereon). The Board will consider borrowing if it is in the shareholders' interests to do so. In particular, because the Board intends to minimise cash balances, the Company may borrow on a short-term to medium-term basis (in particular, against Structured Products) for cashfl ow purposes and to facilitate the payment of dividends and expenses in the early years.
The Company will not vary the investment objective or the investment policy, to any material extent, without the approval of shareholders. The Company intends to be a generalist VCT investing in a wide range of sectors.
The Board controls the overall risk of the Company. Calculus Capital will ensure the Company has exposure to a diversifi ed range of Venture Capital Investments from different sectors. Investec Structured Products will ensure the Company has exposure to a diversifi ed range of Structured Products. The Board believes that investment in these two asset classes provides further diversifi cation.
Calculus Capital has a co-investment policy between its various funds whereby investment allocations are generally offered to each party in proportion to their respective funds available for investment, subject to: (i) a priority being given to any of the funds in order to maintain their tax status; (ii) the time horizon of the investment opportunity being compatible with the exit strategy of each fund; and (iii) the risk/reward profi le of the investment opportunity being compatible with the target return for each fund. The terms of the investments may differ between the parties. In the event of any confl icts between the parties, the issues will be resolved at the discretion of the independent Directors, designated members and committees. It is not intended that the Company will co-invest with Directors or members of the Calculus Capital management team (including family members).
In respect of the Venture Capital Investments, funds attributable to separate share classes will co-invest (i.e. pro rata allocation per fund, unless one of the funds has a pre-existing investment where the incumbent fund will have priority, or as otherwise approved by the Board). Any potential confl ict of interest arising will be resolved on a basis which the Board believes to be equitable and in the best interests of all shareholders. A co-investment policy is not considered necessary for the Structured Products.
Calculus Capital Limited has been appointed to manage the Venture Capital Investments portfolio of VCT Qualifying Investments.
Investec Structured Products (a trading name of Investec Bank plc) has been appointed to manage the Structured Products portfolio of non VCT Qualifying Investments .
| 6 Months to 31 August 2011 |
13 Months to 28 February 2011 |
7 Months to 31 August 2010 |
|
|---|---|---|---|
| Total return | |||
| Total return | £(133,000) | £308,000 | £2,000 |
| Total return per ordinary share | (2.8)p | 8.3p | 0.1p |
| Revenue | |||
| Net loss after tax | £(37,000) | £(112,000) | £(42,000) |
| Revenue return per ordinary share | (0.8)p | (3.0)p | (1.3)p |
| As at 31 August 2011 |
As at 28 February 2011 |
As at 31 August 2010 |
|
|---|---|---|---|
| Assets (investments valued at bid market prices) Net assets Net asset value ("NAV") per ordinary share |
£4,450,000 93.9p |
£4,836,000 102.1p |
£3,657,000 94.6p |
| Mid market quotation Ordinary shares Premium/(discount)to bid price NAV |
99.5p 6.0% |
99.5p (2.5)% |
99.5p 5.2% |
| 6 Months to 31 August 2011* |
|
|---|---|
| Total return Total return Total return per C share |
£(16,000) (0.8)p |
| Revenue Net loss after tax Revenue return per C share |
£(21,000) (1.1)p |
| As at 31 August 2011 |
|
|---|---|
| Assets (investments valued at bid market prices) Net assets NAVper C share |
£1,806,000 93.5p |
| Mid market quotation C shares Premium to bid price NAV |
94.0 p 0.5% |
* The C shares were issued in three tranches, on 1 April 2011, 5 April 2011 and 4 May 2011.
I am pleased to present your Company's fi nancial results for the six months ended 31 August 2011. This report marks the fi rst nineteen months of the Company which has been a period of progress. In this period, a number of notable achievements occurred.
The Investec Structured Products Calculus VCT plc is a joint venture between Investec Structured Products (part of Investec plc which is a member of the FTSE 100) and Calculus Capital Limited, and brings together both Managers' award-winning expertise in their respective fi elds of Structured Products and venture capital. A net total of £6. 35 million has been raised to date, with your Board and Managers committing over £1 million of this, demonstrating their confi dence in the Company and the product offering. The C share fundraising undertaken earlier in the year has increased the size of the Company over which the annual running costs can be spread and will provide greater opportunities for diversifi cation. Moreover, the Company charges some of the lowest annual management fees in the VCT sector.
The past six months have been a time of unusually high volatility for stock markets and challenging economic conditions for business as many western countries struggle to come to terms with excessive debt burdens and low growth. This can create attractive investment opportunities for those willing to take a medium-term view but it can sometimes seem a turbulent ride. I am pleased to say that your Company has continued to make good progress. As at 31 August 2011, the unaudited net asset value per ordinary share was 93.9 p, and the unaudited net asset value per C share was 9 3.5 p. The decline in the net asset value of the ordinary shares since the end of your Company's last fi nancial year in February refl ects the ex-dividend value of the net assets following payment of the tax-free annual dividend in July, but also refl ects the fall in FTSE 100 Index (on which the majority of the Structured Products are based) during the period.
Our non-qualifying investments are managed by Investec Structured Products, who to date have invested approximately £3. 39 million in a range of Structured Products of varying durations and counterparties. Of this, £2.5 4 million is attributable to the Ordinary Share Fund and £850,000 is attributable to the C Share Fund. At a general meeting held on 4 August 2011, shareholders approved an investment in a collateralised Structured Product issued by Investec Bank plc on behalf of the C Share Fund.
Calculus Capital manages the portfolio of Venture Capital Investments made by the Company. It is intended that approximately 75 per cent. of the Company's funds will be invested over a three year period in a diversifi ed portfolio of holdings in unquoted VCT qualifying companies. In order to achieve this, there will be a phased reduction in the Structured Products portfolio and a corresponding increase in the portfolio of Venture Capital Investments.
Calculus Capital has made Venture Capital Investments in three unquoted companies to date, totalling approximately £1 million. Of this, approximately £900,000 is attributable to the Ordinary Share Fund and £90,000 is attributable to the C Share Fund. The Ordinary Share Fund and the C Share Fund are managed separately, although they both have the same investment remit and, therefore, both have very similar portfolios.
During the period, several further investments were made on behalf of the Ordinary Share Fund. In March, an additional £50,000 was invested in Terrain Energy Limited ("Terrain") as ordinary equity, followed by £300,000 in MicroEnergy Generation Services Limited ("MicroEnergy") during April. MicroEnergy is a company setup to acquire renewable, microgeneration facilities, including (but not limited to) wind, anaerobic digestion, hydro and micro CHP (Combined Heat and Power). This investment was provided as £150,000 of ordinary equity and £150,000 in the form of long -term loan stock with a coupon of 7 per cent.
The fi rst Venture Capital Investment was made on behalf of the C Share Fund during August, when £90,000 was invested in Terrain. Half of this investment was provided as ordinary equity, with the other £45,000 provided as long-term loan stock with a coupon of 7 per cent. The recent investments in Terrain form part of a fundraising programme intended to give the company visibility over its funding needs to meet development, appraisal and exploration commitments until the end of 2012.
A more detailed analysis of the investment portfolios can be found in the respective Investment Managers' Reviews that follow this statement.
The Company is in the process of completing an investment in Heritage House Media Limited which provides services to the domestic and inbound tourism industry, with particular emphasis on the heritage sector. Key brands are Hudson's and Open Britain. The Company is in negotiations on a number of other Qualifying Investments.
Notwithstanding recentGovernment initiatives, access to fi nance for smaller UK companies remains tight and valuations have reached more realistic levels, providing an attractive investment scenario for your Company. The Company continues to build a diversifi ed portfolio of investments which we believe will deliver sustained longterm performance. Small companies are an important source of growth for the UK economy and we are seeing a number of interesting opportunities across a variety of sectors at the present time.
Michael O'Higgins Chairman 31 October 2011
Calculus Capital Limited manages the VCT's portfolio of Qualifying Investments. It is intended, over a three year period, to invest approximately 75 per cent. of the Company's funds in a diversifi ed portfolio of unquoted qualifying companies. In general, we prefer to take stakes of suffi cient size to enable us to play a more infl uential role in helping the companies develop. Investments may be by way of loan stock and/or preference shares. This provides income for the Company to help pay regular dividends and provides a measure of risk mitigation.
The Ordinary Share Fund and the C Share Fund are managed separately although they both have the same investment remit and, therefore, both have very similar portfolios.
As at 31 August 2011, three Qualifying Investments had been made relating to the Ordinary Share Fund, in Terrain Energy Limited ("Terrain"), Lime Technology Limited ("Lime") and MicroEnergy Generation Services Limited ("MicroEnergy"). One Qualifying Investment had been made on behalf of the C Share Fund, in Terrain .
Terrain holds a portfolio of oil and gas assets onshore in the UK. Its main producing well is at Keddington in Lincolnshire from which oil is shipped weekly by tanker to the Immingham oil refi nery. The Company initially invested £250,000 in Terrain in July 2010, followed by another £50,000 of ordinary equity in March 2011. Both of these investments were on behalf of the Ordinary Share Fund. In August 2011, £90,000 was invested in Terrain on behalf of the C Share Fund. Half of this investment was provided as ordinary equity, with the other £45,000 provided as long -term loan stock with a coupon of 7 per cent. These recent investments form part of a fundraising programme intended to give Terrain visibility over its funding needs to meet development, appraisal and exploration commitments until the end of 2012.
| Latest Audited Results: Period Ended 31 December 2010 |
Investment Information | Ordinary Share Fund |
C Share Fund |
|
|---|---|---|---|---|
| Turnover | £271,257 | Total cost | £300,000 | £90,000 |
| Pre-tax loss | £( 158,185) | Total valuation | £307,000 | £90,000 |
| Net assets | £1,952,887 | Income recognised in period | £7,000 | – |
| Total voting rights* | 2.49% | 1.05% | ||
| Valuation basis: Fair value based on cost of recent investment supported by discounted cash fl ow |
* Other funds managed by Calculus Capital have an interest in this company and have a combined equity holding of 19.2 per cent. This follows the additional investment in Terrain in August 2011.
Lime was founded in 2002 and is a leader in renewable lime and hemp based building products for the mainstream construction industry. At the time of investment, Lime's main product was Tradical® Hemcrete® which is a negative carbon bio-composite product comprised of hemp and a lime based binder. This was supplied as raw materials for mixing on site. The very bad winter in 2010/11 severely impacted drying on site. Consequently, the company accelerated its launch of Hembuild® which is supplied as precast panels to site. Through its subsidiary, Hemp Technology, the company controls the hemp supply chain from seed to fi nished wall. Lime's products are being used in the construction of Marks & Spencer's fl agship Cheshire Oaks store and have previously been used in the construction of 16 houses at David Cameron's constituency at Stanton Harcourt, an Adnams distribution centre and in a temperature controlled warehouse for the Wine Society. The Company has subscribed under two rights issues during the year to maintain its percentage investment.
As a small company, Lime is exempt from fi ling full accounts.
| Latest Audited Results: Period Ended 4 November 2010 |
Investment Information | Ordinary Share Fund | |
|---|---|---|---|
| Total cost | £304,000 | ||
| Net assets | £1,358,275 | Total valuation | £280,000 |
| Income recognised in period | £9,000 | ||
| Total voting rights* | 0.60% | ||
| Valuation basis: Fair value based on cost of recent investment |
* Other funds managed by Calculus Capital have an interest in this company and have a combined equity holding of 15.59 per cent.
In early April, £300,000 was invested in MicroEnergy on behalf of the Ordinary Share Fund. MicroEnergy is a company set up to acquire renewable, microgeneration facilities, including (but not limited to) wind, anaerobic digestion, hydro and micro CHP (Combined Heat and Power). The investment was provided as £150,000 of ordinary equity and £150,000 in the form of long -term loan stock with a coupon of 7 per cent. MicroEnergy has acquired fi ve5kW wind turbines to date in East Anglia and has plans to acquire approximately thirty -fi ve by 5 April 2012.
As a relatively new company, MicroEnergy has not yet fi led statutory accounts.
| Latest Audited Results | Investment Information | Ordinary Share Fund |
|---|---|---|
| No statutory accounts have been fi led | Total cost | £300,000 |
| Total valuation | £300,000 | |
| Income recognised in period | – | |
| Total voting rights* | 8.67% | |
| Valuation basis: Fair value based on cost of recent investment |
* Other funds managed by Calculus Capital have an interest in this company and have a combined equity holding of 9.89 per cent.
The Company is in the process of completing an investment in Heritage House Media Limited which provides services to the domestic and inbound tourism industry with particular emphasis on the heritage sector. Key brands are Hudson's and Open Britain.
The Investment Manager believes that the current market remains attractive for investment as access to fi nance for smaller UK companies remains tight and valuations have reached more realistic levels. Although the UK economic outlook remains uncertain, we are seeing a number of interesting opportunities across a variety of sectors. Any improvement to the economic climate will assist small companies which are an important source of growth for the UK economy.
Calculus Capital Limited 31 October 2011
In line with the Company's strategy set out in the original Offer documents, a large percentage of the initial cash raised has been used to build a portfolio of Structured Products. The portfolio of Structured Products has been constructed with different issuers and differing maturity periods to minimise risk and create a diversifi ed portfolio. The FTSE 100 Initial Index Levels for these investments range from 4,805.75 to 5,718.13.
Except for the RBS Autocallable product, all of the Structured Product investments to date have potential returns that are by way of a fi xed amount payable as long as the Final Index Level is higher than the Initial Index Level (e.g. for the Abbey National Treasury Services Structured Product the fi xed amount is 85 per cent. (plus 100 per cent. of the initial notional amount) if the Final Index Level is higher than the Initial Index Level of 4,940.68). All of the products have capital at risk on a one-to-one basis if the FTSE 100 falls by more than 50 per cent. and fails to recover at maturity.
The RBS Autocallable will mature early with a fi xed payout of 10.5per cent. per annum if, on any anniversary of the strike date, the closing level of the Index is above the Initial Index Level. Capital is at risk on a one-to-one basis if the FTSE 100 falls by more than 50 per cent. and fails to recover at maturity.
At the end of the reporting period the FTSE 100 closing level was 5,394.53. The amount invested in Structured Products during the period was £950,000, of which £100,000 was invested in the Ordinary Share Fund and the rest in the C Share Fund. The total amount to date invested in Structured Products stands at £2,54 3,000 for the ordinary shares and £850,000 for the C shares, representing 56 per cent. and 4 7 per cent. of the net funds raised respectively. As at 31 August 2011 the Structured Products portfolio was valued at £2,928, 000 for the ordinary shares and £86 1,000 for the C shares. At the time of writing, the FTSE 100 closing level was 5, 488.65 (close 21 October 2011) which has had a small positive effecton the performance of the Structured Products portfolio.
The Investment Manager constantly reviews the portfolio of investments to assess asset allocation and the need to realise investments.
| Issuer | Strike Date | Maturity Date |
FTSE 100 Initial Index Level |
Notional Investment |
Purchase Price |
Cost | Price as at 31 August 2011 |
Valuation as at 31 August 2011 |
Return/Capital at Risk ("CAR")† |
|---|---|---|---|---|---|---|---|---|---|
| The Royal Bank of Scotland plc |
05/05/2010 | 12/05/2015 | 5,341.93 | £275,000 | £0.96 | £264,000 | £1.0309 | £283,498 | 162.5% if FTSE 100* higher; CAR if FTSE 100 falls by more than 50% |
| Investec Bank plc |
14/05/2010 | 19/11/2015 | 5,262.85 | £500,000 | £0.98 | £489,550 | £1.1349 | £567,429 | 185% if FTSE 100* higher; CAR if FTSE 100 falls by more than 50% |
| Abbey National Treasury Services |
25/05/2010 | 18/11/2015 | 4,940.68 | £350,000 | £0.99 | £346,430 | £1.2373 | £433,055 | 185% if FTSE 100* higher; CAR if FTSE 100 falls by more than 50% |
The above investments have been designed to meet the 43.75p per ordinary share interim return by 14 December 2015. A total of £ 1,099,980 ( 24.72 per cent. of net monies raised) was invested in the above Structured Products. Assuming no issuer defaults and if the FTSE 100 Final Index Level is higher than the Initial Index Level, then these investments will return £ 2,019,375, equivalent to 4 6. 62p per ordinary share.
| Issuer | Strike Date | Maturity Date |
FTSE 100 Initial Index Level |
Notional Investment |
Purchase Price |
Cost | Price as at 31 August 2011 |
Valuation as at 31 August 2011 |
Return/Capital at Risk ("CAR")† |
|---|---|---|---|---|---|---|---|---|---|
| Nomura Bank International |
28/05/2010 | 20/02/2013 | 5,188.43 | £350,000 | £0.98 | £343,000 | £1.1455 | £400,925 | 137% if FTSE 100* higher; CAR if FTSE 100 falls by more than 50% |
| Morgan Stanley International |
10/06/2010 | 17/12/2012 | 5,132.50 | £500,000 | £1.00 | £500,000 | £1.1452 | £572,575 | 134% if FTSE 100* higher; CAR if FTSE 100 falls by more than 50% |
| HSBC Bank plc |
01/07/2010 | 06/07/2012 | 4,805.75 | £500,000 | £1.00 | £500,000 | £1.1533 | £576,650 | 125.1% if FTSE 100* higher; CAR if FTSE 100 falls by more than 50% |
| The Royal Bank of Scotland plc** |
18/03/2011 | 20/03/2017 | 5,718.13 | £50,000 | £1.00 | £50,000 | £0.93 | £46,315 | Autocallable 10.5% p.a. ; CAR if FTSE 100falls more than 50% |
| Abbey National Treasury Services** |
03/08/2011 | 05/02/2014 | 5,584.51 | £50,000 | £1.00 | £50,000 | £0.96 | £48,010 | 126% if FTSE 100* higher ; CAR if FTSE 100 falls more than 50% |
The above investments are aimed to provide additional return as dividends. These investments may be sold prior to maturity if it is deemed that a greater return can be made by Calculus Capital investing in Qualifying Investments.
| Issuer | Strike Date | Maturity Date |
FTSE 100 Initial Index Level |
Notional Investment |
Purchase Price |
Cost | Price as at 31 August 2011 |
Valuation as at 31 August 2011 |
Return/Capital at Risk ("CAR")† |
|---|---|---|---|---|---|---|---|---|---|
| Investec Bank plc** |
05/08/2011 | 10/03/2017 | 5,246.99 | £450,000 | £1.00 | £450,000 | £1.0739 | £483,237 | 182% if FTSE 100* higher ; CAR if FTSE 100 falls more than 50% |
The above Investec Structured Product investment in the C Share Fund (£450,000) is a collateralised product. The collateral comprises a portfolio of securities issued by each of HSBC Bank plc (Aa2), Nationwide Building Society (A2), Santander UK plc (A1), The Royal Bank of Scotland plc (A2) and Lloyds TSB Bank plc (A1), and/or cash and/or UK government debt (Moody's Ratings as at 21 October 2011 in brackets). Insolvency risk to Investec is replaced with a risk spread across these named institutions.
A total of £450,000 (25.92 per cent. of net assets) was invested in the above Structured Productof the C Share Fund. Assuming no issuer defaults and if the FTSE 100 Final Index Level is higher than the Initial Index Level, then this investmentwill return £819,000, equivalent to 42.4p per C share. Further investments into the Structured Products portfolio will be required to produce an interim return of 47.5p per C share by 14 March 2017.
| Issuer | Strike Date | Maturity Date |
FTSE 100 Initial Index Level |
Notional Investment |
Purchase Price |
Cost | Price as at 31 August 2011 |
Valuation as at 31 August 2011 |
Return/Capital at Risk ("CAR")† |
|---|---|---|---|---|---|---|---|---|---|
| The Royal Bank of Scotland plc** |
18/03/2011 | 20/03/2017 | 5,718.13 | £200,000 | £1.00 | £200,000 | £0.9263 | £185,260 | Autocallable 10.5% p.a ; CAR if FTSE 100falls more than 50% |
| Abbey National Treasury Services ** |
03/08/2011 | 05/02/2014 | 5,584.51 | £200,000 | £1.00 | £200,000 | £0.9602 | £192,040 | 126% if FTSE 100* higher ; CAR if FTSE 100 falls more than 50% |
The above investment s target an average return of 9.58 per cent. per annum. These investments may be sold prior to maturity if it is deemed that a greater return can be made by Calculus Capital by investing in Qualifying Investments.
* The Final Index Level is calculated using 'averaging', meaning that we take the average of the closing levels of the FTSE 100 on each business day over the 2–6 months of the Structured Product plan term (the length of the averaging period may differ for each plan). The use of averaging to calculate the return can reduce adverse effects of a falling market or sudden market falls shortly before maturity. Equally, it can reduce the benefi ts of an increasing market or sudden market rises shortly before maturity.
† All of the investments in Structured Products in respect of the two funds will either be capital protected or capital at risk on a one-to-one basis where the FTSE 100 Index falls by more than 50 per cent. and the Final Index Level is below the Initial Index Level. If the FTSE 100 Index does fall by more than 50 per cent. at any time during the investment period and fails to recover at maturity, the capital will be at risk on a maximum one-to-one basis (Capital at Risk ("CAR")) (i.e. if the FTSE 100 Index falls by more than 50 per cent. during the investment period and on maturity is down 25 per cent., capital within that Structured Product will be reduced by 25 per cent.).
** These investments have been purchased during the 2011–2012 fi nancial year.
Investec Structured Products 31 October 2011
| Sector | Net Assets |
|---|---|
| Structured Products 69% Unquoted – Qualifying |
Structured Products 66% Unquoted – loan stock 13% |
| Investments 21% Unquoted – other non |
Unquoted – ordinary and preference shares 7% |
| Qualifying Investments 10% |
Unquoted – other non Qualifying Investments 10% Net current assets 4% |
| Company | Nature of Business | Book Cost £'000 |
Valuation £'000 |
% of Net Assets |
% of Portfolio |
|---|---|---|---|---|---|
| Structured Products | |||||
| Investec Bank plc | Banking | 490 | 567 | 13% | 13% |
| The Royal Bank of Scotland plc Abbey National Treasury Services |
Banking Banking |
314 396 |
329 481 |
7% 11% |
8% 11% |
| Nomura Bank International | Banking | 343 | 401 | 9% | 10% |
| Morgan Stanley International | Banking | 500 | 573 | 13% | 13% |
| HSBC Bank plc | Banking | 500 | 577 | 13% | 14% |
| Total Structured Products | 2,543 | 2,928 | 66% | 69% | |
| Qualifying Investments | |||||
| Terrain Energy Limited | Oil and gas production | 300 | 307 | 7% | 7% |
| Lime Technology Limited | Construction | 304 | 280 | 6% | 7% |
| Micro Energy Generation Services Limited |
Energy | 300 | 300 | 7% | 7% |
| Total Qualifying Investments | 904 | 887 | 20% | 21% | |
| Other Non-Qualifying Investments | |||||
| Fidelity Liquidity Fund | Liquidity fund | 81 | 81 | 2% | 2% |
| Goldman Sachs Liquidity Fund | Liquidity fund | 50 | 50 | 1% | 1% |
| Scottish Widows Liquidity Fund | Liquidity fund | 314 | 314 | 7% | 7% |
| Total Other Non-Qualifying Investments | 445 | 445 | 10% | 10% | |
| Total investments | 3,892 | 4,260 | 96% | 100% | |
| Net current assets less creditors due after one year | 190 | 4% | |||
| Net assets | 4,450 | 100% |
| Company | Nature of Business | Book Cost £'000 |
Valuation £'000 |
% of Net Assets |
% of Portfolio |
|---|---|---|---|---|---|
| Structured Products | |||||
| Investec Bank plc | Banking | 450 | 484 | 27% | 29% |
| The Royal Bank of Scotland plc | Banking | 200 | 185 | 10% | 11% |
| Abbey National Treasury Services | Banking | 200 | 192 | 11% | 11% |
| Total Structured Products | 850 | 861 | 48% | 51% | |
| Qualifying Investments | |||||
| Terrain Energy Limited | Oil and gas production | 90 | 90 | 4% | 5% |
| Total Qualifying Investments | 90 | 90 | 4% | 5% | |
| Other Non-Qualifying Investments | |||||
| Fidelity Liquidity Fund | Liquidity fund | 251 | 251 | 14% | 15% |
| Goldman Sachs Liquidity Fund | Liquidity fund | 100 | 100 | 6% | 6% |
| Scottish Widows Liquidity Fund | Liquidity fund | 382 | 382 | 21% | 23% |
| Total Other Non-Qualifying Investments | 733 | 733 | 41% | 44% | |
| Total investments | 1,673 | 1,684 | 93% | 100% | |
| Net current assets less creditors due after one year | 122 | 7% | |||
| Net assets | 1,806 | 100% |
The important events that have occurred during the period under review, the key factors infl uencing the fi nancial statements and the principal uncertainties for the remaining six months of the fi nancial year are set out in the Chairman's Statement and Investment Managers' Reviews.
The principal risks facing the Company are substantially unchanged since the date of the Annual Report and Accounts for the period ended 28 February 2011 and continue to be as set out in that report.
Risks faced by the Company include, but are not limited to, loss of approval as a venture capital trust and other regulatory breaches, risks of making Venture Capital Investments, risks attaching to investment in Structured Products, liquidity/marketability risk, changes in legislation/taxation, engagement of third party advisers, C shares versus ordinary shares, market price risk and credit risk.
The Directors confi rm that to the best of their knowledge:
This Half Yearly Financial Report was approved by the Board of Directors on 31 October 2011 and the above responsibility statement was signed on its behalf by Michael O'Higgins, Chairman.
| 6 Months Ended 31 August 2011 |
7 Months Ended 31 August 2010 |
13 Months Ended 28 February 2011* |
||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Note | Revenue Return £'000 |
Capital Return £'000 |
Total £'000 |
Revenue Return £'000 |
Capital Return £'000 |
Total £'000 |
Revenue Return £'000 |
Capital Return £'000 |
Total £'000 |
|
| Ordinary Share Fund | ||||||||||
| Investment holding (losses)/gains Income Investment |
– 23 |
(78) – |
(78) 23 |
– 5 |
55 – |
55 5 |
– 20 |
446 – |
446 20 |
|
| management fee Other operating |
(6) | (18) | (24) | (4) | (11) | (15) | (9) | (26) | (35) | |
| expenses | (54) | – | (54) | (43) | – | (43) | (123) | – | (123) | |
| (Loss)/profi ton ordinary activities |
||||||||||
| before taxation | (37) | (96) | (133) | (42) | 44 | 2 | (112) | 420 | 308 | |
| Taxation on ordinary activities |
3 – |
– | – | – | – | – | – | – | – | |
| (Loss)/profi ton ordinary activities after taxation |
(37) | (96) | (133) | (42) | 44 | 2 | (112) | 420 | 308 | |
| Return per ordinary share – basic |
2 (0.8)p |
(2.0)p | (2.8)p | (1.3)p | 1.4p | 0.1p | (3.0)p | 11.3p | 8.3p |
| Investment holding gains Income |
– 3 |
11 – |
11 3 |
|
|---|---|---|---|---|
| Investment management fee Other operating |
(2) | (6) | (8) | |
| expenses | (22) | – | (22) | |
| (Loss)/profi ton ordinary activities before taxation |
(21) | 5 | (16) | |
| Taxation on ordinary activities |
3 | – | – | – |
| (Loss)/profi ton ordinary activities after taxation |
(21) | 5 | (16) | |
| Return per C share – basic |
2 | (1.1)p | 0. 3p | (0.8)p |
* These fi gures are audited.
The total column of th ese statements representthe Income Statement of the Ordinary Share Fund and C ShareFund. The supplementary revenue return and capital return columns are both prepared in accordance with the Association of Investment Companies ("AIC") Statement of Recommended Practice ("SORP").
No operations were acquired or discontinued during the period.
All items in the above statements derive from continuing operations.
| 6 Months Ended 31 August 2011 |
7 Months Ended 31 August 2010 |
13 Months Ended 28 February 2011* |
||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Note | Revenue Return £'000 |
Capital Return £'000 |
Total £'000 |
Revenue Return £'000 |
Capital Return £'000 |
Total £'000 |
Revenue Return £'000 |
Capital Return £'000 |
Total £'000 |
|
| Total | ||||||||||
| Investment holding (losses)/gains Income Investment |
– 26 |
(67) – |
(67) 26 |
– 5 |
55 – |
55 5 |
– 20 |
446 – |
446 20 |
|
| management fee Other operating |
(8) | (24) | (32) | (4) | (11) | (15) | (9) | (26) | (35) | |
| expenses | (76) | – | (76) | (43) | – | (43) | (123) | – | (123) | |
| (Loss)/profi ton ordinary activities before taxation |
(58) | (91) | (149) | (42) | 44 | 2 | (112) | 420 | 308 | |
| Taxation on ordinary activities |
3 | – | – | – | – | – | – | – | – | – |
| (Loss)/profi ton ordinary activities after taxation |
(58) | (91) | (149) | (42) | 44 | 2 | (112) | 420 | 308 | |
| Return per ordinary share – basic |
2 | (0.8)p | (2.0)p | (2.8)p | 1.3p | 1.4p | 0.1p | (3.0)p | 11.3p | 8.3p |
| Return per C share – basic |
2 | (1.1)p | 0. 3p | (0.8)p |
* These fi gures are audited.
The total column of this statement represents the Company's Income Statement.
The supplementary revenue return and capital return columns are both prepared in accordance with the Association of Investment Companies ("AIC") Statement of Recommended Practice ("SORP").
No operations were acquired or discontinued during the period.
All items in the above statement derive from continuing operations.
Condensed Reconciliation of Movements in Shareholders' Funds for the period from 1 March 2011 to 31 August 2011 (Unaudited)
| Share Capital £'000 |
Share Premium Account £'000 |
Special Reserve £'000 |
Capital Reserve Realised £'000 |
Capital Reserve Unrealised £'000 |
Revenue Reserve £'000 |
Total £'000 |
|
|---|---|---|---|---|---|---|---|
| Ordinary Share Fund | |||||||
| For the 6 month period to 31 August 2011 1 March 2011 Loss for the period Expenses of share issues Dividends paid (Note 8) |
47 – – – |
752 – (4) – |
3,729 – – (249) |
(26) (18) – – |
446 (78) – – |
(112) (37) – – |
4,836 (133) (4) (249) |
| 31 August 2011 | 47 | 748 | 3,480 | (44) | 368 | (149) | 4,450 |
| For the 7 month period to 31 August 2010 1 February 2010 ( Loss)/gain for the period Issue of redeemable non-voting shares |
– – 50 |
– – – |
– – – |
– (11) – |
– 55 – |
– (42) – |
– 2 50 |
| Redemption of redeemable non voting shares Issue of ordinary shares Expenses of share issues |
(50) 39 – |
– 3,829 (213) |
– – – |
– – – |
– – – |
– – – |
(50) 3,868 (213) |
| 31 August 2010 | 39 | 3,616 | – | (11) | 55 | (42) | 3,657 |
| For the 13 month period to 28 February 2011* 1 February 2010 (Loss)/ gain for the period Issue of redeemable non-voting shares Redemption of redeemable non-voting shares Increase in share capital in issue Expenses of share issues Share premium cancelled |
– – 50 (50) 47 – |
– – – – 4,740 (259) |
– – – – – – |
– (26) – – – – |
– 446 – – – – |
– (112) – – – – |
– 308 50 (50) 4,787 (259) |
| during period | – | (3,729) | 3,729 | – | – | – | – |
| 28 February 2011 | 47 | 752 | 3,729 | (26) | 446 | (112) | 4,836 |
| C Share Fund | |||||||
| For the 6 month period to 31 August 2011 1 March 2011 (Loss)/gain for the period Increase in share capital in issue Expenses of share issues 31 August 2011 |
– – 19 – 19 |
– – 1,912 (109) 1,803 |
– – – – – |
– (6) – – (6) |
– 11 – – 11 |
– (21) – – (21) |
– (16) 1,931 (109) 1,806 |
* These fi gures are audited.
The notes on pages 23 to 27 form an integral part of theseAccounts.
16 Investec Structured Products Calculus VCT | Half Yearly Report | 31 August 2011
| Share Capital £'000 |
Share Premium Account £'000 |
Special Reserve £'000 |
Capital Reserve Realised £'000 |
Capital Reserve Unrealised £'000 |
Revenue Reserve £'000 |
Total £'000 |
|
|---|---|---|---|---|---|---|---|
| Total | |||||||
| For the 6 month period to 31 August 2011 1 March 2011 Loss for the period |
47 – |
752 – |
3,729 – |
(26) (24) |
446 (67) |
(112) (58) |
4,836 (149) |
| Increase in share capital in issue Expenses of share issues Dividends paid (Note 8) |
19 – – |
1,912 (113) – |
– – (249) |
– – – |
– – – |
– – – |
1,931 (113) (249) |
| 31 August 2011 | 66 | 2,551 | 3,480 | (50) | 379 | (170) | 6,256 |
| For the 7 month period to 31 August 2010 1 February 2010 ( Loss)/gain for the period Issue of redeemable non-voting shares Redemption of redeemable non voting shares Issue of ordinary shares Expenses of share issues 31 August 2010 |
– – 50 (50) 39 – 39 |
– – – – 3,829 (213) 3,616 |
– – – – – – – |
– (11) – – – – (11) |
– 55 – – – – 55 |
– (42) – – – – (42) |
– 2 50 (50) 3,868 (213) 3,657 |
| For the 13 month period to 28 February 2011* 1 February 2010 (Loss)/ gain for the period Issue of redeemable non-voting shares Redemption of redeemable non-voting shares Increase in share capital in issue Expenses of share issues Share premium cancelled during period |
– – 50 (50) 47 – – |
– – – – 4,740 (259) (3,729) |
– – – – – – 3,729 |
– (26) – – – – – |
– 446 – – – – – |
– (112) – – – – – |
– 308 50 (50) 4,787 (259) – |
| 28 February 2011 | 47 | 752 | 3,729 | (26) | 446 | (112) | 4,836 |
* These fi gures are audited.
| Note | 31 August 2011 £'000 |
31 August 2010 £'000 |
28 February 2011* £'000 |
|
|---|---|---|---|---|
| Ordinary Share Fund | ||||
| Fixed assets | ||||
| Investments at fair value through profi t or loss | 4 | 4,260 | 2,748 | 4,488 |
| Current assets | ||||
| Debtors | 302 | 157 | 214 | |
| Cash at bank and on deposit | 147 | 911 | 326 | |
| 449 | 1,068 | 540 | ||
| Creditors: amounts falling due within one year | ||||
| Creditors | (141) | (141) | (176) | |
| Due to C Share Fund | (100) | – | – | |
| Net current assets | 208 | 927 | 364 | |
| Non-current liabilities | ||||
| IFA trail commission | (18) | (18) | (16) | |
| Total net assets | 4,450 | 3,657 | 4,836 | |
| Capital and reserves | ||||
| Called-up share capital | 7 | 47 | 39 | 47 |
| Share premium account | 748 | 3,616 | 752 | |
| Special reserve | 3,480 | – | 3,729 | |
| Capital reserve – unrealised | 368 | 55 | 446 | |
| Capital reserve – realised | (44) | (11) | (26) | |
| Revenue reserve | (149) | (42) | (112) | |
| Total shareholders' funds | 4,450 | 3,657 | 4,836 | |
| Net asset value per ordinary share | 5 | 93.9p | 94.6p | 102.1p |
* These fi gures are audited.
| Note | 31 August 2011 £'000 |
|
|---|---|---|
| C Share Fund | ||
| Fixed assets Investments at fair value through profi t or loss |
4 | 1,684 |
| Current assets | ||
| Debtors Cash at bank and on deposit |
55 29 |
|
| 84 | ||
| Creditors: amounts falling due within one year Creditors |
(51) | |
| Due From Ordinary Share Fund | 100 | |
| Net current assets | 133 | |
| Non-current liabilities IFA trail commission |
(11) | |
| Total net assets | 1,806 | |
| Capital and reserves Called-up share capital Share premium account |
7 | 19 1,803 |
| Special reserve Capital reserve – unrealised Capital reserve – realised Revenue reserve |
– 11 (6) (21) |
|
| Total shareholders' funds | 1,806 | |
| Net asset value per C share | 5 | 93.5p |
| Note | 31 August 2011 £'000 |
31 August 2010 £'000 |
28 February 2011* £'000 |
|
|---|---|---|---|---|
| Total | ||||
| Fixed assets Investments at fair value through profi t or loss |
4 | 5,944 | 2,748 | 4,488 |
| Current assets Debtors |
357 | 157 | 214 | |
| Cash at bank and on deposit | 176 | 911 | 326 | |
| 533 | 1,068 | 540 | ||
| Creditors: amounts falling due within one year Creditors |
(192) | (141) | (176) | |
| Net current assets | 341 | 927 | 364 | |
| Non-current liabilities | ||||
| IFA trail commission | (29) | (18) | (16) | |
| Total net assets | 6,256 | 3,657 | 4,836 | |
| Capital and reserves | ||||
| Called-up share capital | 7 | 66 | 39 | 47 |
| Share premium account | 2,551 | 3,616 | 752 | |
| Special reserve | 3,480 | – | 3,729 | |
| Capital reserve – unrealised | 379 | 55 | 446 | |
| Capital reserve – realised | (50) | (11) | (26) | |
| Revenue reserve | (170) | (42) | (112) | |
| Total shareholders' funds | 6,256 | 3,657 | 4,836 | |
| Net asset value per ordinary share | 5 | 93.9p | 94.6p | 102.1p |
| Net asset value per C share | 5 | 93.5p |
* These fi gures are audited.
| 6 Months Ended 31 August |
7 Months Ended 31 August |
13 Months Ended 28 February |
||
|---|---|---|---|---|
| Note | 2011 £'000 |
2010 £'000 |
2011* £'000 |
|
| Ordinary Share Fund | ||||
| Operating activities | ||||
| Investment income received | 10 | – | 7 | |
| Deposit interest received Investment management fees |
2 (23) |
3 – |
6 (24) |
|
| Other cash payments | (64) | (54) | (169) | |
| Cash expended from operations | 6 | (75) | (51) | (180) |
| Cash fl ow from investing activities Purchase of investments Sale of investments |
(455) 605 |
(2,693) – |
(4,042) – |
|
| Net cash infl ow/(outfl ow) from investing activities | 150 | (2,693) | (4,042) | |
| Net cash infl ow/(outfl ow) before fi nancing | 75 | (2,744) | (4,222) | |
| Cash fl ow from fi nancing activities Equity dividend paid |
8 | (249) | – | – |
| Redeemable non-voting shares issued | – | 50 | 50 | |
| Redemption of redeemable non-voting shares | – | (50) | (50) | |
| Shares issued | – | 3,868 | 4,787 | |
| Expenses of share issues Net cash (outfl ow)/infl ow from fi nancing activities |
(5) | (213) 3,655 |
(239) 4,548 |
|
| (Decrease)/increase in cash at bank and on deposit | (254) (179) |
911 | 326 |
| Operating activities Investment income received Other cash payments |
1 (155) |
|
|---|---|---|
| Cash expended from operations | 6 | (154) |
| Cash fl ow from investing activities Purchase of investments |
(1,673) | |
| Net cash outfl ow before fi nancing | (1,827) | |
| Cash fl ow from fi nancing activities Redeemable non-voting shares issued Expenses of share issues |
1,931 (75) |
|
| Net cash infl ow from fi nancing activities | 1,856 | |
| Increase in cash at bank and on deposit | 29 |
* These fi gures are audited.
| Note | 6 Months Ended 31 August 2011 £'000 |
7 Months Ended 31 August 2010 £'000 |
13 Months Ended 28 February 2011* £'000 |
|
|---|---|---|---|---|
| Total | ||||
| Operating activities Investment income received Deposit interest received Investment management fees Other cash payments |
11 2 (23) (219) |
– 3 – (54) |
7 6 (24) (169) |
|
| Cash expended from operations | 6 | (229) | (51) | (180) |
| Cash fl ow from investing activities Purchase of investments Sale of investments |
(2,128) 605 |
(2,693) – |
(4,042) – |
|
| Net cash outfl ow from investing activities | (1,523) | (2,693) | (4,042) | |
| Net cash outfl ow before fi nancing | (1,752) | (2,744) | (4,042) | |
| Cash fl ow from fi nancing activities Equity dividend paid Redeemable non-voting shares issued Redemption of redeemable non-voting shares Shares issued Expenses of share issues |
8 | (249) – – 1,931 (80) |
– 50 (50) 3,868 (213) |
– 50 (50) 4,787 (239) |
| Net cash infl ow from fi nancing activities | 1,602 | 3,655 | 4,548 | |
| (Decrease)/increase in cash at bank and on deposit | (150) | 911 | 326 |
* These fi gures are audited.
These Accounts have been prepared under the historical cost convention, except for the valuation of fi nancial assets at fair value through profi t or loss, in accordance with UK Generally Accepted Accounting Practice ("UK GAAP"). These Accounts cover the six month period ended 31 August 2011. The comparatives cover the seven month period from incorporation on 1 February 2010 to 31 August 2010, and the thirteen month period from 1 February 2010 to 28 February 2011.
In determining the analysis of total income and expenses as between capital return and revenue return, the Directors have followed the guidance contained in the AIC SORP, as revised in 2009, and on the assumption that the Company maintains VCT status.
The Accounts are prepared on the basis of the accounting policies set out in the Annual Report and Accounts for the period ended 28 February 2011.
The fi nancial information contained in this report does not constitute full statutory accounts as defi ned in Section 434 of the Companies Act 2006. The fi nancial information for the six months to 31 August 2011 and the period to 31 August 2010 has not been audited or reviewed by the Company's Auditors pursuant to the Auditing Practices Board guidance on such reviews.
The information for the period ended 28 February 2011 has been extracted from the latest published Annual Report and Accounts, which have been fi led with the Registrar of Companies. The report of the Auditors on those Accounts contained no qualifi cation or statement under Sections 498(2) or (3) of the Companies Act 2006.
After making enquiries, and having reviewed the portfolio, balance sheet and projected income and expenditure for the next twelve months, the Directors have a reasonable expectation that the Company has adequate resources to continue in operation for the foreseeable future. The Directors have therefore adopted the going concern basis in preparing these Accounts.
| 6 Months Ended 31 August 2011 |
7 Months Ended 31 August 2010 |
13 Months Ended 28 February 2011 |
|||||||
|---|---|---|---|---|---|---|---|---|---|
| Revenue pence |
Capital pence |
Total pence |
Revenue pence |
Capital pence |
Total pence |
Revenue pence |
Capital pence |
Total pence |
|
| Return per ordinary share |
(0.8) | (2.0) | (2.8) | (1.3) | 1.4 | 0.1 | (3.0) | 11.3 | 8.3 |
| Return per C share |
(1.1) | 0.3 | (0.8) |
Revenue return per ordinary share is based on the net revenue loss on ordinary activities after taxation of £37,000 (31 August 2010: £42,000; 28 February 2011: £112,000) and on 4,738,463 ordinary shares (31 August 2010: 3,121,857; 28 February 2011: 3,721,530), being the weighted average number of ordinary shares in issue during the period.
Capital return per ordinary share is based on the net capital loss for the period of £96,000 (31 August 2010: £44,000 gain; 28 February 2011: £420,000 gain) and on 4,738,463 ordinary shares (31 August 2010: 3,121,857; 28 February 2011: 3,721,530), being the weighted average number of ordinary shares in issue during the period.
Total return per ordinary share is based on the net loss on ordinary activities for the period of £133,000 (31 August 2010: £2,000 gain; 28 February 2011: £308,000 gain) and on 4,738,463 ordinary shares (31 August 2010: 3,121,857; 28 February 2011: 3,721,530), being the weighted average number of ordinary shares in issue during the period.
Revenue return per C share is based on the net revenue loss on ordinary activities after taxation of £21,000 and on 1,904,924 C shares, being the weighted average number of C shares in issue during the period.
Capital return per C share is based on the net capital gain for the period of £5,000 and on 1,904,924 C shares, being the weighted average number of C shares in issue during the period.
Total return per C share is based on the total loss for the period of £16,000 and on 1,904,924 C shares, being the weighted average number of C shares in issue during the period.
The estimated effective tax rate at the year end is 0% for both share funds. This remains unchanged from the prior period.
| 31 August | 31 August | 28 February |
|---|---|---|
| 2011 | 2010 | 2011 |
| £'000 | £'000 | £'000 |
| Investment portfolio summary | |||
|---|---|---|---|
| Investments in Structured Products | 2,928 | 2,498 | 2,882 |
| Unquoted investments | 887 | 250 | 556 |
| Other investments | 445 | – | 1,050 |
| 4,260 | 2,748 | 4,488 |
| Investment portfolio summary | |
|---|---|
| Investments in Structured Products | 861 |
| Unquoted investments | 90 |
| Other investments | 733 |
| 1,684 |
| Investment portfolio summary | |||
|---|---|---|---|
| Investments in Structured Products | 3,789 | 2,498 | 2,882 |
| Unquoted investments | 977 | 250 | 556 |
| Other investments | 1,178 | – | 1,050 |
| 5,944 | 2,748 | 4,488 |
| 31 August | 31 August | 28 February | |
|---|---|---|---|
| 2011 | 2010 | 2011 | |
| pence | pence | pence | |
| Ordinary shares of 1 pence each C shares of 1 pence each |
93.9 93.5 |
94.6 | 102.1 |
The basic net asset value per ordinary share is based on net assets of £4,450,000 (31 August 2010: £3,657,000; 28 February 2011: £4,836,000) and on 4,738,463 ordinary shares (31 August 2010: 3,867,917; 28 February 2011: 4,738,463), being the number of ordinary shares in issue at the period end.
The basic net asset value per C share is based on net assets of £1,806,000 and on 1,931,095 C shares, being the number of C shares in issue at the period end.
| 31 August | 31 August | 28 February |
|---|---|---|
| 2011 | 2010 | 2011 |
| £'000 | £'000 | £'000 |
| (Loss)/profi t on ordinary activities before taxation | (133) | 2 | 308 |
|---|---|---|---|
| Losses/(gains) on investments | 78 | (55) | (446) |
| Interfund receipt | (2) | – | – |
| Increase in debtors | (85) | (159) | (214) |
| Increase in creditors | 67 | 161 | 172 |
| Cash expended from operating activities | (75) | (51) | (180) |
| Losson ordinary activities before taxation | (16) |
|---|---|
| Gains on investments | (11) |
| Interfund payment | 2 |
| Increase in debtors | (155) |
| Increase in creditors | 26 |
| Cash expended from operating activities | (154) |
| (Loss)/profi t on ordinary activities before taxation | (149) | 2 | 308 |
|---|---|---|---|
| Losses/(gains) on investments Increase in debtors |
67 (140) |
(55) (159) |
(446) (214) |
| (Decrease)/increase in creditors | (7) | 161 | 172 |
| Cash expended from operating activities | (229) | (51) | (180) |
| 31 August 2011 |
||
|---|---|---|
| Number | £'000 |
| 1 March 2011 | 4,738,463 | 47 |
|---|---|---|
| Shares issued in period | – | – |
| 4,738,463 | 47 |
The Ordinary Share Fund had 3,867,917 shares in issue (£39,000) on 31 August 2010 .
| 1 March 2011 | – | – |
|---|---|---|
| Shares issued in period | 1,931,095 | 19 |
| 1,931,095 | 19 |
An offer for subscription for C shares of 1p each was launched in January 2011 and the shares were issued in April and May 2011.
For the period to 28 February 2011 the Ordinary Share Fund declared a fi nal dividend of 5.25p per ordinary share on 4,738,463 shares amounting to £248,769. The dividend was paid on 29 July 2011 to ordinary shareholders on the register at 3 June 2011.
Investec Structured Products is a related party in respect of its appointment as an investment manager to the Company and is entitled to a performance incentive fee. Investec Structured Products will receive an arrangement fee of 0.75 per cent. of the amount invested in each Structured Product. This arrangement fee shall be paid to Investec Structured Products by the issuer of the relevant Structured Product. No arrangement fee will be paid to Investec Structured Products in respect of any decision to invest in Investec-issued Structured Products. Investec Structured Products has agreed not to earn an annual management fee from the Company.
As at 31 August 2011, £81,000 (31 August 2010: £67,000; 28 February 2011: £81,000) was payable to Investec Structured Products in relation to the initial fee of 5 per cent. of the gross funds raised pursuant to the original ordinary share offer. £ 22,000 was payable to Investec Structured Products in relation to the initial fee of 5 per cent. of the gross funds raised pursuant to the C share offer. In addition, £2 30,000 (31 August 2010: £128,000; 28 February 2011: £185,000) was owed to the Ordinary Share Fund by Investec Structured Products as claw back of costs in excess of the agreed expenses cap of 3 per cent. £33,000 was owed to the C Share Fund.
Calculus Capital is regarded as a related party in respect of its appointment as an investment manager to the Company. For the period ended 31 August 2011, fees of £32,000 (31 August 2010: £15,000; 28 February 2011: £35,000) were payable to Calculus Capital, of which £20,000 (31 August 2010: £15,000; 28 February 2011: £10,000) were outstanding as at 31 August 2011. Calculus Capital is also entitled to a performance incentive fee.
John Glencross, a Director of the Company, has an interest in Calculus Capital and is a director of Terrain Energy Limited and Lime Technology Limited, companies in which the Company has invested.
Calculus Capital receives an annual fee from Terrain Energy Limited for the provision of John Glencross as a director, as well as an annual monitoring fee which also covers the provision of certain administrative support services. In the period ended 31 August 2011, the amount paid to Calculus Capital which was attributable to the investment made by the Company was £4,200 (excluding VAT) (31 August 2010: £nil; 28 February 2011: £2,713).
Calculus Capital also receives an annual fee from Lime Technology Limited for the provision of John Glencross as a director, as well as an annual monitoring fee. In the period ended 31 August 2011, the amount paid to Calculus Capital which was attributable to the investment made by the Company was £2,400 (excluding VAT) (31 August 2010: £nil; 28 February 2011: £1,626).
After the period end Calculus Capital received arrangement fees of £9,000 (excluding VAT) (31 August 2010: £nil; 28 February 2011: £nil) in relation to the investment in MicroEnergy Generation Services Limited.
No incentive fee accrued to either Investment Manager during the period.
The following Directors are/were considered to be related parties due to their connection with one of the Investment Managers: John Glencross is a director of Calculus Capital, Ian Wohlman is a director of Investec Bank plc (of which Investec Structured Products is a trading division). Ian Wohlman retired as a Director at the Annual General Meeting held on 30 June 2011. Both Directors have agreed not to receive any remuneration from the Company.
Michael O'Higgins (Chairman) Kate Cornish-Bowden John Glencross Steven Meeks Mark Rayward Philip Swatman
Beaufort House 51 New North Road Exeter EX4 4EP Telephone: 01392 477 500
Investec Structured Products 2 Gresham Street London EC2V 7QP Telephone: 020 7597 4000 Website: www.investecstructuredproducts.com
Calculus Capital Limited 104 Park Street London W1K 6NF Telephone: 020 7493 4940 Website: www.calculuscapital.com
Capita Sinclair Henderson (Trading as Capita Financial Group – Specialist Fund Services) Beaufort House 51 New North Road Exeter EX4 4EP
Grant Thornton UK LLP 30 Finsbury Square London EC2P 2YU
Martineau No. 1 Colmore Square Birmingham B4 6AA
Singer Capital Markets Limited One Hanover Street London W1S 1YZ
Capita Registrars The Registry 34 Beckenham Road Beckenham Kent BR3 4TU Telephone: 0871 644 0300
( Calls cost 10p per minute plus network extras. Lines are open Monday to Friday 8.30am to 5.30pm)
Investec Structured Products is a trading name of Investec Bank plc, registered address 2 Gresham Street, London EC2V 7QP. Investec Bank plc is authorised and regulated by the Financial Services Authority. Registered under Financial Services Authority No. 172330.
Calculus Capital Limited, registered address 104 Park Street, London W1K 6NF, is authorised and regulated by the Financial Services Authority. Registered under Financial Services Authority No. 190854.
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