Albion Technology & General VCT PLC

Annual Report and Financial Statements

for the year ended 31 December 2O22

Albion Technology & General VCT PLC

Annual Report and Financial Statements

for the year ended 31 December 2022

Shareholder information Financial adviser information

For help relating to dividend payments, shareholdings

and share certificates please contact Computershare

Investor Services PLC:

Tel: 0370 873 5854 (UK national rate call, lines are

open 8.30am – 5.30pm; Mon – Fri, calls are recorded)

Website: www.investorcentre.co.uk

Shareholders can access holdings and valuation

information regarding any of their shares held with

Computershare by registering on Computershare’s

website.

Shareholders can also contact the Chairman directly

on: AATGchair@albion.capital

For enquiries relating to the performance of the

Company, and information for financial advisers

please contact the Business Development team at

Albion Capital Group LLP:

Email: info@albion.capital

Tel: 020 7601 1850 (lines are open 9.00am – 5.30pm;

Mon – Fri, calls are recorded)

Website: www.albion.capital

Please note that these contacts are unable to provide financial or taxation advice.

COMPANY INFORMATION

Company name Country of incorporation Legal form

Albion Technology & General VCT

PLC (the “Company”)

United Kingdom Public Limited Company

Directors Company number Auditor

R Archibald, Chairman

P M Payn

M A Cordeiro

P H Reeve

C S Richardson (appointed

1 June 2022)

04114310 BDO LLP

55 Baker Street

London, W1U 7EU

Manager, company secretary,

AIFM and registered office

Registrar Corporate broker

Albion Capital Group LLP

1 Benjamin Street

London, EC1M 5QL

Computershare Investor Services

PLC

The Pavilions

Bridgwater Road

Bristol, BS99 6ZZ

Panmure Gordon (UK) Limited

40 Gracechurch Street

London, EC3V 0BT

Taxation adviser Legal adviser Depositary

Philip Hare & Associates LLP

6 Snow Hill

London, EC1A 2AY

Bird & Bird LLP

12 New Fetter Lane

London, EC4A 1JP

Ocorian Depositary (UK) Limited

Level 5, 20 Fenchurch Street

London, EC3M 3BY

Albion Technology & General VCT PLC is a member of The Association of Investment Companies

(www.theaic.co.uk).

Cover photo © istock / StudioM1

All inside images © istock / AodLeo, StudioM1, NiseriN, Just_Super, shulz and © Unsplash / CHUTTERSNAP, Ricardo Gomez Angel, Teemu Paananen

Strategic

07 Investment objective and policy and Financial calendar

08 Financial summary

10 Chairman’s Statement

14 Strategic Report

28 Portfolio of investments

31 Portfolio companies

36 Environmental, Social and Governance (“ESG”) report

Governance

41 The Board of Directors

43 The Manager

46 Directors’ report

53 Statement of Directors’ responsibilities

54 Statement of corporate governance

61 Directors’ remuneration report

65 Independent Auditor’s report

Company information and Financials

73 Income statement

74 Balance sheet

75 Statement of changes in equity

76 Statement of cash flows

77 Notes to the Financial Statements

93 Notice of Annual General Meeting

Contents

Strategic

INVESTMENT OBJECTIVE AND POLICY

The Company’s investment objective is to provide investors with a regular and predictable source of dividend

income, combined with the prospect of long-term capital growth, through a balanced portfolio of predominantly

unquoted growth and technology businesses in a qualifying Venture Capital Trust (“VCT”).

credit ratings. They may also be invested in liquid

open-ended equity funds providing income and capital

equity exposure (where it is considered economic to do

so). Investment in such open-ended equity funds will

not exceed 7.5% of the Company’s assets at the time

of investment.

Risk diversification and maximum exposures

Risk is spread by investing in a number of different

businesses within VCT qualifying industry sectors using

a mix of securities. The maximum the Company will

invest in a single company is 15% of the Company’s

assets at cost at the time of investment. The value of

an individual investment is expected to increase over

time as a result of trading progress and a continuous

assessment is made of investments’ suitability for

sale. It is possible that individual holdings may grow

in value to a point where they represent a significantly

higher proportion of total assets prior to a realisation

opportunity being available.

Borrowing powers

The Company’s maximum exposure in relation to

gearing is restricted to 10% of the adjusted share

capital and reserves. The Directors do not have any

intention of utilising long-term gearing.

FINANCIAL CALENDAR

2 June 2023

Record date for first dividend

Noon on 6 June 2023

Annual General Meeting

30 June 2023

Payment date of first dividend

September 2023

Announcement of Half-yearly results for the six months ending 30 June 2023

Investment policy

The Company will invest in a broad portfolio of

unquoted growth and technology businesses.

Allocation of assets will be determined by the

investment opportunities which become available,

but efforts will be made to ensure that the portfolio is

diversified in terms of sectors and stages of maturity of

portfolio companies.

VCT qualifying and non-qualifying investments

Application of the investment policy is designed to

ensure that the Company continues to qualify, and

remains approved as, a VCT by HM Revenue and

Customs (“VCT regulations”). The maximum amount

invested in any one company is limited to any HMRC

annual investment limits. It is intended that normally

at least 80% of the Company’s funds will be invested

in VCT qualifying investments. The VCT regulations

also have an impact on the type of investments and

qualifying sectors in which the Company can make

an investment.

Funds held to invest in VCT qualifying assets or for

liquidity purposes will be held as cash on deposit or

invested in floating rate notes or similar instruments

with banks or other financial institutions with high

Albion Technology & General VCT PLC

STRATEGIC

Albion Technology & General VCT PLC 8

FINANCIAL SUMMARY

(3.74)p (4.64)% 3.99p 72.92p 196.54p

Decrease in total

shareholder value

for the year ended

31 December 2022

(2021: increase of

14.98p)

††

Total loss on

opening net asset

value per share

(2021: gain of

21.6%)

††

Total tax-free

dividends per

Ordinary share paid

in the year ended

31 December 2022

(a dividend yield of

4.9% on opening

net asset value)

(2021: 3.68p with

a dividend yield of

5.3%)

Net asset value

per Ordinary

share as at

31 December 2022

(2021: 80.65p)

Total shareholder

value as at

31 December

2022

†

(2021: 200.28p)

††

Methodology: The total shareholder value to the shareholder including original amount invested (rebased to 100) from 1 January 2013 assuming that

dividends were reinvested at the net asset value of the Company at the time that the shares were quoted ex-dividend. Transaction costs are not taken

into account.

†Total shareholder value at 31 December 2022 is calculated using net asset value per share at 31 December 2022 plus dividends paid per Ordinary

share since launch to 31 December 2022.

††These are considered Alternative Performance Measures, see note 2 on page 17 of the Strategic report for further explanation.

Total shareholder value relative to FTSE All-Share Index total return

(with dividends reinvested)

Jan 2013 Dec 2013 Dec 2014 Dec 2015 Dec 2016 Dec 2017 Dec 2018 Dec 2019 Dec 2020 Dec 2021 Dec 2022

Return (pence per share)

200

180

160

140

120

100

Total shareholder value

FTSE All-Share Index total return

STRATEGIC

9Albion Technology & General VCT PLC

(3.74)p (4.64)% 3.99p 72.92p 196.54p

Decrease in total

shareholder value

for the year ended

31 December 2022

(2021: increase of

14.98p)

††

Total loss on

opening net asset

value per share

(2021: gain of

21.6%)

††

Total tax-free

dividends per

Ordinary share paid

in the year ended

31 December 2022

(a dividend yield of

4.9% on opening

net asset value)

(2021: 3.68p with

a dividend yield of

5.3%)

Net asset value

per Ordinary

share as at

31 December 2022

(2021: 80.65p)

Total shareholder

value as at

31 December

2022

†

(2021: 200.28p)

††

The diagram above shows the one year, three year, five year and ten year total return to shareholders. This return comprises dividends paid and

the change in net asset value over the relevant periods.

Financial summary

Albion Technology & General VCT PLC – Performance data

1 year return 3 year return

(average 4.4% p.a.)

5 year return

(average 8.2% p.a.)

10 year return

(average 4.9% p.a.)

13.3%

41.2%

49.5%

-4.6%

Movements in net asset value

31 December 2022

pence per share

31 December 2021

pence per share

Opening net asset value 80.65 69.35

Capital (loss)/return (4.51) 14.93

Revenue return 0.46 0.37

Total (loss)/return (4.05) 15.30

Ordinary dividends paid (3.99) (3.68)

Impact from share capital movements 0.31 (0.32)

Net asset value 72.92 80.65

Total shareholder value

Ordinary shares

(pence per share)

Total dividends paid since launch to 31 December 2022 123.62

Net asset value as at 31 December 2022 72.92

Total shareholder value to 31 December 2022 196.54

In addition to the dividends noted above, the Board has declared a first dividend for the year ending 31 December

2023 of 1.82 pence per share to be paid on 30 June 2023 to shareholders on the register on 2 June 2023.

For historic shareholders, further details regarding the total shareholder value for C Shares and Albion Income and

Growth VCT PLC can be found at www.albion.capital/funds/AATG under the ‘Financial Summary for Previous Funds’

section.

A more detailed breakdown of the dividends paid per year can be found at www.albion.capital/funds/AATG under

the ‘Dividend History’ section.

Results and dividends

As at 31 December 2022, the net asset value was 72.92

pence per share compared to 80.65 pence per share at

31 December 2021. The total loss after tax was £6.3

million compared to £19.9 million total return in the

year to 31 December 2021.

In line with our variable dividend policy targeting

around 5% of NAV per annum, the Company paid

semi-annual dividends totalling 3.99 pence per share

for the year to 31 December 2022 (2021: 3.68 pence

per share). The Board has declared a first dividend for

the year ending 31 December 2023 of 1.82 pence per

share to be paid on 30 June 2023 to shareholders on

the register on 2 June 2023.

Investment portfolio

The results for the year showed net losses on

investments of £4.5 million, against gains of £21.5

million for the previous year; the results are largely

driven by unrealised losses across the portfolio.

Oxsensis decreased in value by £4.1 million, Black

Swan Data by £2.1 million, and Oviva by £1.1 million,

all as a result of difficult trading conditions. Against

these losses, there have been unrealised gains,

including a £1.1 million uplift in Convertr Media, and

realised gains including the disposal of Credit Kudos

and MyMeds&Me, both of which are detailed below.

Quantexa, the largest company in our portfolio (14%

of net asset value), continues to show strong revenue

growth which has counter-balanced the well-publicised

Albion Technology & General VCT PLC 10

The Company’s portfolio has faced an uncertain macroeconomic and

geopolitical environment during the financial year under review. With

the war in Ukraine, high inflation, increasing interest rates, combined

with political instability, there has been considerable market volatility

impacting the Company and its portfolio.

The Company returned a loss in the year ended 31 December 2022

of 3.74 pence per share, which represents a 4.6% loss on opening net

asset value. Notwithstanding these disappointing results, which are not

surprising given the economic environment in the financial year, the

Board remains encouraged by the potential of the portfolio to deliver

positive longer term returns.

CHAIRMAN’S

STATEMENT

Robin Archibald

STRATEGIC

pressure on technology sector valuations and has not

seen a valuation movement during the reported year.

After the year end Quantexa completed an externally

led Series E fundraising, and further details are in the

Updated NAV announcement section on page 13.

The Company had a number of investment realisations

in the year with proceeds totalling £11.5 million,

leading to realised gains during the year of £1.6 million.

The notable exits included Credit Kudos delivering 5.2

times return on cost, Phrasee delivering 3.5 times cost

and MyMeds&Me delivering 3.4 times cost. Further

details on the above disposals, and other realisations,

can be found in the realisations table on page 30.

During a busy year for the Manager, a total of £16.7

million was invested into portfolio companies, of which

£9.2 million was invested across fifteen new portfolio

companies, all of which are likely to require further

investment as they develop and grow. The average age

of the fifteen new portfolio companies was four years,

demonstrating the Company’s focus on investing in

earlier-stage businesses and building value over the

longer term. The five largest new investments during

the year are show below.

A further £7.5 million was invested into existing

portfolio companies, the largest being: £1.4 million

into Cantab Research (trading as Speechmatics), £1.1

million into Runa Network (previously WeGift) and £1.0

million into Black Swan Data.

The three largest investments in the Company’s

portfolio, being Quantexa, Radnor House School

and Proveca, are valued at £26.9 million and represent

22.2% of the Company’s net asset value.

Overall, 33% of the portfolio by value is trading

profitably, measured by earnings before interest, tax

and depreciation, with a number of our investments

showing strong growth in fast-developing markets.

More information on each of the investments made by

the Company can be found on the Manager’s website

at www.albion.capital.

£1.5 million into

Peppy Health, a

platform providing

expert support

for underserved

areas of health

and wellness (e.g.

menopause) via

content, video,

chat support as

an employment

benefit for

employees

£1.4 million into

Toqio FinTech

which bridges

the gap between

financial services

and financial

outcomes by

providing an

orchestration

platform to any

business large

or small which

wishes to launch a

financial product

£0.9 million into

PeakData, a

software platform

that uses big data

analytics and AI to

collate data from

across the web to

provide insights

and analytics for

the world’s top

pharmaceutical

companies, key

opinion leaders

and healthcare

professionals

before and after

the launch of new

therapies

£0.8 million into

GX Molecular

(trading as CS

Genetics), a

developer of

a wet-phase

approach to single

cell indexing in a

single tube that

enables increased

scalability and

high quality single-

cell analysis

£0.7 million

into OutThink, a

software platform

to measure and

manage human

risk for enterprises

11Albion Technology & General VCT PLC

Chairman’s statement

Board composition

I have had the privilege of serving as a Director of the

Company for nine years, including two as Chairman,

and I will retire at the Annual General Meeting in June

2023. I am delighted that Clive Richardson, an existing

Board member, will succeed me as Chairman. Mary Anne

Cordeiro, who has also served nine years, will retire from

the Board and Margaret Payn will become SID when

Mary Anne stands down.

The Board, as part of its ongoing succession planning,

is well advanced in the process of recruiting for new

Directors, which will be announced in due course. The

aim continues to be a small and focussed Board. We

will aim to continue to be a diverse Board, as has been

the case during the Company’s life, and with collective

competence to the fore.

Risks and uncertainties

The Company faces a number of significant risks,

including higher interest rates, inflation, the ongoing

impact of Russia’s invasion of Ukraine, and potentially

a period of economic stagnation, or even recession,

in the UK. This complex backdrop is factored into

how the Company is managed, including in its

management of cash.

The concentration risk to the technology sector, which

is part of the Company’s stated investment objective, is

noted as technology company valuations have become

more volatile in the current economic climate.

The Manager is continually assessing the exposure to

these risks for each portfolio company and appropriate

actions, where possible, are being implemented. This

includes the potential provision of further financial

support to portfolio companies where necessary.

A detailed analysis of the principal risks and

uncertainties facing the business is shown in the

Strategic report on pages 24 to 26.

Share buy-backs

It remains a primary objective to maintain sufficient

cash resources for investment in new and existing

portfolio companies, for the continued payment of

dividends to shareholders and to provide liquidity in

the secondary market through share buy-backs. The

Board’s policy is to buy back shares in the market,

subject to the overall constraint that such purchases

are in the Company’s best interest. It is the Board’s

intention for such buy-backs to be in the region of a 5%

discount to net asset value, so far as market conditions

and liquidity permit. The Board continues to review the

use of buy-backs and is satisfied that it is an important

means of providing market liquidity for shareholders.

Details of shares bought back during the year can be

found in note 16.

The Company also manages a relatively high level

of distributable reserves which can be used for share

buy-backs and the payment of dividends. Following

shareholder approval last year, additional distributable

reserves were created through the reclassification of

the share premium account balance.

Albion VCTs’ Prospectus Top Up Offers

Your Board, in conjunction with the Boards of five other

VCTs managed by Albion Capital Group LLP, launched

a Prospectus Top Up Offer of new Ordinary shares on 6

January 2022 and applications reached its £24 million

limit under the Offer on 29 March 2022.

A new Prospectus Top Up Offer was launched on 10

October 2022. The Board announced on 18 January

2023 that, following strong demand for the Company’s

shares, it had elected to exercise the over-allotment

facility, taking the total amount under offer to £15.5

million. An allotment was scheduled to take place on 24

February 2023. However due to positive developments

in the Albion managed portfolio impacting on post

balance sheet valuations and, following advice, the

date of the second allotment was deferred to 31 March

2023 for the 2022/2023 tax year. On 22 March 2023,

the Company was pleased to announce that it had

reached its limit under its latest Offer which was fully

subscribed and closed to further applications.

Chairman’s statement

“ During a busy year for the

Manager, a total of £16.7

million was invested into

portfolio companies, of

which £9.2 million was

invested across fifteen new

portfolio companies.”

The funds raised by the Company pursuant to the

Offer will be added to the cash resources available

for investment, putting the Company into a position

to take advantage of investment opportunities over

the next two to three years. The proceeds of the Offer

will be applied in accordance with the Company’s

investment policy.

Updated NAV Announcement post year end

On 2 March 2023, a NAV update was announced

with a pleasing 4.63 pence per share uplift,

representing a 6.35% increase on the previously

announced 31 December 2022 NAV. This update

resulted from Quantexa, a company within the

portfolio, undergoing an external fundraising process,

which was not known at 31 December 2022. This

transaction has since completed and was announced

by Quantexa on 4 April 2023.

Annual General Meeting

The Annual General Meeting (“AGM”) will be held

at noon on 6 June 2023 via the Lumi platform.

Information on how to participate in the live webcast

can be found on the Manager’s website at www.albion.

capital/vct-hub/agms-events. The notice of the AGM is

at the end of this document.

The Board welcomes questions from shareholders at

the AGM and shareholders will be able to ask questions

using the Lumi platform, or in person. Alternatively,

shareholders can email their questions to AATGchair@

albion.capital prior to the Meeting.

Further details on the format and business to be

conducted at the AGM can be found in the Directors’

report on pages 51 and 52 and in the Notice of the

Meeting on pages 93 to 96.

The Board encourages shareholders to vote on

the Company business at the AGM, irrespective

of attendance, and strongly recommends that

shareholders should vote in favour of all the resolutions

being proposed at the meeting.

Outlook and prospects

Continuing risks and uncertainties, largely outside

the Company’s control, make it difficult to be entirely

confident about what lies ahead. The portfolio is

well diversified with companies at different stages of

maturity and targeted at sectors such as software,

FinTech and healthcare. These are sectors where

we believe growth can be resilient and sustainable.

The recently announced 6.35% NAV uplift since the

year end gives the Board further confidence that the

Company is well positioned in the current economic

climate to generate long term value for shareholders.

Robin Archibald

Chairman

6 April 2023

1313Albion Technology & General VCT PLC

STRATEGIC REPORT

The full investment policy can be found on page 7.

Current portfolio sector allocation

The following pie charts show the split of the portfolio

valuation as at 31 December 2022 by sector, stage of

investment and number of employees. This is a useful

way of assessing how the Company and its portfolio are

diversified across sector, portfolio companies’ maturity

measured by revenues and their size measured by

the number of employees. Details of the principal

investments made by the Company are shown in the

Portfolio of investments on pages 28 to 30.

Investment objective and policy

The Company’s investment objective is to provide

investors with a regular and predictable source of

dividend income, combined with the prospect of long-

term capital growth, through a balanced portfolio

of unquoted growth and technology businesses in a

qualifying VCT.

The Company will invest in a broad portfolio of unquoted

growth and technology businesses. Allocation of assets

will be determined by the investment opportunities

which become available, but efforts will be made to

ensure that the portfolio is diversified in terms of sectors

and stages of maturity of portfolio companies.

Albion Technology & General VCT PLC 14

Portfolio analysis by sector

(including cash & liquid investments)

Portfolio analysis by sector

(excluding cash & liquid investments)

Cash and net assets 24% (15%)

Other (including education) 8% (9%)

Healthcare (including digital healthcare) 17% (19%)

Renewable energy 9% (10%)

FinTech 23% (26%)

Software & other technology 19% (21%)

Comparatives for 31 December 2021 are in brackets

Other (including education) 11% (11%)

Healthcare (including digital healthcare) 22% (23%)

Renewable energy 11% (11%)

FinTech 30% (31%)

Software & other technology 26% (24%)

11%

26%

30%

11%

22%

19%

23%

24%

17%

STRATEGIC

Strategic report

Portfolio analysis by stage of investment Portfolio analysis by number of employees

Direction of portfolio

The current portfolio remains well-balanced both in

terms of stage of investment and sectors, with FinTech

accounting for 23%, software and other technology

accounting for 19%, healthcare (including digital

healthcare) accounting for 17%, renewable energy

accounting for 9% and other (including education)

accounting for 8%.

Due to the share allotments under the 2021/22 and

2022/23 Prospectus Top Up Offers, and the exits during

the year, cash is a significant proportion of the portfolio

at 22%. The Company will use these funds to support

those portfolio companies that require it, as well as to

capitalise on any new investment opportunities that

arise. We therefore expect that proportion of investments

in the FinTech, software and other technology and

healthcare sectors (including digital healthcare) will

increase, and that the proportion of asset-based

investments will decrease over the coming years.

Results and dividends

£’000

Net capital loss for the year ended 31 December 2022 (7,021)

Net revenue return for the year ended 31 December 2022 720

Total loss for the year ended 31 December 2022 (6,301)

Dividend of 2.02 pence per share paid on 30 June 2022 (3,240)

Dividend of 1.97 pence per share paid on 31 December 2022 (3,267)

Transferred from reserves (12,808)

Net assets as at 31 December 2022 121,247

Net asset value per share as at 31 December 2022 72.92p

Early stage (revenue less than £1 million) 9% (12%)

Growth (revenue between £1 million and £5 million) 20% (27%)

Scale up (revenue over £5 million) 71% (61%)

Under 20 6% (4%)

21 - 50 12% (26%)

51 - 100 12% (14%)

101+ 59% (45%)

Renewable energy* 11% (11%)

*Renewable energy companies have no employees

12%

71%

12%

20%

59%

11%

Comparatives for 31 December 2021 are in brackets

15Albion Technology & General VCT PLC

Investment income largely comprises loan stock

interest on our renewable energy investments, which

the Company intends to hold for the longer term.

As a result, loan stock income is expected to remain

relatively flat over the near term and most of the

Company’s investment returns are expected to be

delivered via capital gains. Dividend income is likely

to reduce next year, as memsstar declared a large

dividend prior to its disposal in the year.

On 2 March 2023, a NAV update was announced with

a 4.63 pence per share uplift (6.35%), as detailed in the

Chairman’s statement on page 13.

Future prospects

The Company’s financial results for the ended 31

December 2022 demonstrate that the portfolio

remains well balanced across sectors and risk classes,

and is largely weathering the ongoing global issues

caused as a result of higher levels of interest rates and

inflation and other economic headwinds. Although

there remains much uncertainty, the Board considers

that the Company has the potential to deliver long

term growth, whilst maintaining predictable dividend

payments to shareholders.

Key Performance Indicators (“KPIs”) and

Alternative Performance Measures (“APMs”)

The Directors believe that the following KPIs and APMs,

which are typical for VCTs, used in the Board’s assessment

of the Company, will provide shareholders with sufficient

information to assess how effectively the Company is

applying its investment policy to meet its objectives.

The Directors are satisfied that the results shown in the

following KPIs and APMs give a good indication that the

Company is achieving its investment objective and policy.

These are:

1. Net asset value per share and total

shareholder value

Total shareholder value decreased by 3.74 pence to

196.54 pence per Ordinary share for the year ended

31 December 2022 (4.6% on the opening net asset

value).

The graph on page 8 reflects the total shareholder

value performance of the Company relative to the

FTSE All-share Index over the last ten years.

Results and dividends

The Company paid ordinary dividends of 3.99 pence per

share during the year ended 31 December 2022 (2021:

3.68 pence per share). The Board has a variable dividend

policy which targets an annual dividend yield of around

5% on the prevailing net asset value. The Board has

declared a first dividend for the year ending 31 December

2023 of 1.82 pence per share to be paid on 30 June 2023

to shareholders on the register on 2 June 2023.

As shown in the Income statement on page 73,

investment income has increased to £1,631,000

(2021: £1,077,000). This is largely due to the receipt

of dividends which include a dividend declared by

memsstar immediately prior to the disposal in the

year. As a result, there was an overall revenue gain to

shareholders of £720,000 (2021: £476,000).

The net capital loss for the year was £7,021,000 (2021:

gain of £19,412,000). The net loss was generated largely

due to a fall in the unrealised movement in valuation

of investments, partially offset by gains on disposals.

The gain in 2021 was primarily due to the largest

portfolio company, Quantexa. Further information on

this together with key valuation movements during the

year are outlined in the Investment portfolio section of

the Chairman’s statement. The total loss for the period

was 4.05 pence per share (2021: gain of 15.30 pence per

share).

The Balance sheet on page 74 shows that the net asset

value per share decreased over the year ended 31

December 2022 to 72.92 pence per share (2021: 80.65

pence per share).

The cash inflow for the year was £12.2 million (2021:

£2.9 million). This resulted mainly from the issue

of new Ordinary shares under the Top Up Offers,

disposal proceeds and loan stock income, offset by

new investments, dividends paid, share buy-backs and

ongoing expenses.

Review of business and outlook

A review of the Company’s business during the year

and its future prospects is contained in the Chairman’s

statement on pages 10 to 13 and in this Strategic report.

There is a continuing focus on growing investments

in the FinTech, healthcare and other software and

technology sectors, and, therefore, we expect the

portfolio to increase its weighting in these sectors.

Albion Technology & General VCT PLC 16

Strategic report

The figures in the table above show that total shareholder

value, despite some annual volatility, mean that the

Company has delivered an average increase of 5.7% per

annum over the past ten years.

The returns to shareholders who have acquired shares

through the C share issue in 2006 and the merger with

Albion Income & Growth VCT in 2013 are shown on

the Company’s Webpage on the Manager’s website

at www.albion.capital/funds/AATG under “Financial

Summary for Previous Funds”. Shareholders who have

acquired shares through Top Up Offers, the dividend

reinvestment scheme or in the market outside the

corporate events will be able to calculate their own

returns based on the price at which they acquired their

shares, the dividends they have received since the

purchase and the current net asset value of their holding.

3. Dividend distributions

Dividends paid in respect of the year ended 31 December

2022 were 3.99 pence per share (2021: 3.68 pence per

share). Cumulative dividends paid since inception were

123.62 pence per Ordinary share.

4. Ongoing charges

As agreed with the Manager in 2015, the ongoing

charges ratio for the year ended 31 December 2022

was capped at 2.75% (2021: 2.75%) with any excess

over the cap being a reduction in the management

fee. Following the reduction to the management fee in

the year, the ongoing charges ratio has decreased to

2.55% (2021: 2.75%). The ongoing charges ratio has

been calculated using The Association of Investment

Companies’ (AIC) recommended methodology. This

figure shows shareholders the total recurring annual

Net asset value per share and total shareholder value*

Net Asset Value

Cumulative dividend

* Total shareholder value is net asset value plus cumulative dividends.

2. Movement in shareholder value in the year

†

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

8.0% 2.5% (4.7%) 3.6% 6.0% 13.2% 11.9% (0.3%) 21.6% (4.6%)

† Calculated as the movement in total shareholder value for the year compared with the opening net asset value.

Pence per share

200

150

100

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

17Albion Technology & General VCT PLC

Strategic report

running expenses (including investment management

fees charged to capital reserves) as a percentage of the

average net assets attributable to shareholders.

5. VCT regulation*

The investment policy is designed to ensure that the

Company continues to qualify, and is approved, as a

VCT by HMRC. In order to maintain its status under

VCT legislation, a VCT must comply on a continuing

basis with the provisions of Section 274 of the Income

Tax Act 2007, details of which are provided in the

Directors’ report on pages 47 and 48.

The relevant tests to measure compliance have been

carried out and independently reviewed for the year

ended 31 December 2022 and are reviewed during the

year. These reviews confirmed that the Company has

complied with all tests.

Gearing

As defined by the Articles of Association, the Company’s

maximum exposure in relation to gearing is restricted

to 10%. of the share capital and reserves adjusted for

any dividends declared. Although the investment policy

permits the Company to borrow, the Directors do not

currently have any intention of utilising long-term gearing

and have not done so in the past.

Operational arrangements

The Company has delegated the investment

management of the portfolio to Albion Capital

Group LLP, which is authorised and regulated by the

Financial Conduct Authority. Albion Capital Group

LLP also provides company secretarial and other

accounting and administrative support to the Company

under the Management Agreement, as well as acting

as the Company’s Alternative Investment Fund

Manager (“AIFM”).

*VCT compliance is not a numerical measure of performance and thus cannot be defined as an APM.

Dividend paid

Dividends paid in the period

Cumulative dividend

Pence per share

120

100

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

Albion Technology & General VCT PLC 18

Strategic report

Management Agreement

A resolution was passed (with 95.6% of votes cast in

favour of the resolution) at the General Meeting on 26

May 2022 which specifically covered changes to the

Management Agreement.

The changes to the Management Agreement included:

lowering the Management fee from 2.5% of net asset

value to 2.0% of net asset value, backdated to 1

January 2022; introduction of a capped administration

fee; and revisions to the performance incentive

arrangements. Full details are available in the Circular

dated 13 April 2022 which can be found on the

Manager’s website at www.albion.capital/funds/AATG/

circular2022.pdf.

Under these new management arrangements, the

ongoing operating costs for the year ended 31

December 2022 have been reduced by £246,000.

Under the Management Agreement, the Manager

provides investment management, secretarial

and administrative services to the Company. The

Management Agreement can be terminated by either

party on 12 months’ notice and is subject to earlier

termination in the event of certain breaches or on

the insolvency of either party. The Manager is paid

an annual fee equal to 2.0% of the net asset value

of the Company, payable quarterly in arrears. The

total annual running costs of the Company, including

management fees payable to Albion Capital Group LLP,

Directors’ fees, professional fees and the costs incurred

by the Company in the ordinary course of business (but

excluding any exceptional items and performance fees

payable to Albion Capital Group LLP) are capped at an

amount equal to 2.75% of the Company’s net assets,

with any excess being met by Albion Capital Group LLP

by way of a reduction in management fees.

In some instances, the Manager is entitled to an

arrangement fee, payable by a portfolio company in

which the Company invests, in the region of 2.0% of

the investment made, and also monitoring fees where

the Manager has a representative on the portfolio

company’s board; these fees are payable by the

investee company. Further details of the Manager’s fee

can be found in note 5 to the financial statements.

Management performance incentive

Under the performance incentive arrangement, the

Manager will receive an incentive fee calculated

annually on a five year average rolling basis, equal to

15% of the performance over a 5% hurdle (applied

to the opening net asset value each year in line with

the current dividend target). This fee will only become

payable when average returns to shareholders are in

excess of 5% per annum over a five year period. The

first payment of a performance fee, if earned, will be

in 2024 based on the audited results of the five years

ending 31 December 2023.

Details of the calculation of the performance incentive

provision can be found in note 15. For the year

ended 31 December 2022, the total provision for the

performance incentive earned is £272,000 (2021: £nil).

Investment and co-investment

The Company co-invests with other Albion Capital Group

LLP managed VCTs. Allocation of investments is on the

basis of an allocation agreement which is based, inter

alia, on the ratio of cash available for investment in each

of the entities and the HMRC VCT qualifying tests.

Liquidity Management

The Board examines regularly both the liquidity of the

Company’s shares in the secondary market, which is

substantially influenced by the use of share buybacks

and share issuance, and the liquidity of the Company’s

portfolio. The nature of investments in a venture capital

portfolio is longer term and these are relatively illiquid in

the short term. Consequently, the Company maintains

sufficient liquidity in cash and near cash assets to

cover the operating costs of the Company and to meet

dividend payments and share buy-backs, as well as to

have the capacity to make fresh investments when the

opportunities arise. Although the Company is authorised

to borrow, in practice it does not borrow. The Board has

no intention that the Company should borrow given the

nature of the Company’s investments, a number of which

have their own gearing. Management of liquidity is one

of the key operational areas that the Board discusses

regularly with the Manager.

19Albion Technology & General VCT PLC

Strategic report

Evaluation of the Manager

The Board, through the Management Engagement

Committee, has evaluated the performance of the

Manager based on:

• returns generated by the Company;

• continued compliance with the VCT regulation;

• long-term prospects of the current portfolio of

investments;

• management of treasury, including use of share

buy-backs and participation in fund raising;

• a review of the Management Agreement and the

services provided therein;

• benchmarking the performance of the Manager

to other service providers, including the

performance of other VCTs that the Manager is

responsible for managing: and

• the contribution made by the administration

and secretarial team to the operation of the

Company.

The Board believes that it is in the interests of

shareholders as a whole, and of the Company, to

continue the appointment of the Manager for the

forthcoming year.

Alternative Investment Fund Managers

Directive (“AIFMD”)

The Board appointed Albion Capital Group LLP as the

Company’s AIFM in 2014 as required by the AIFMD.

The Manager became a full-scope AIFM under the

AIFMD in 2018. As a result, from that date, Ocorian

Depositary (UK) Limited was appointed as Depositary

to oversee the custody and cash arrangements and

provide other AIFMD duties with respect to the

Company. Having the Depositary provides another level

of oversight over the safe-keeping of the Company’s

assets.

Companies Act 2006 Section 172 Reporting

Under Section 172 of the Companies Act 2006, the

Board has a duty to promote the success of the

Company for the benefit of its members as a whole

in both the long and short term, having regard to the

interests of other stakeholders in the Company, such

as suppliers, and to do so with an understanding of the

impact on the community and environment and with

high standards of business conduct, which includes

acting fairly between members of the Company.

The Board is very conscious of these wider

responsibilities in the ways it promotes the Company’s

culture and ensures, as part of its regular oversight,

that the integrity of the Company’s affairs is foremost

in the way the activities are managed and promoted.

This includes regular engagement with the wider

stakeholders of the Company and being alert to issues

that might damage the Company’s standing in the

way that it operates. The Board works very closely with

the Manager in reviewing how stakeholder issues are

handled, ensuring good governance and responsibility

in managing the Company’s affairs, as well as visibility

and openness in how the affairs are conducted.

The Company is an externally managed investment

company with no employees, and as such has nothing

to report in relation to employee engagement but does

keep close attention on how the Board operates as a

cohesive and competent unit. The Company also has no

customers in the traditional sense and, therefore, there

is also nothing to report in relation to relationships with

customers.

The table below sets out the key stakeholders the Board

considers most relevant, details how the Board has

engaged with these key stakeholders and the effect of

these considerations on the Company’s decisions and

strategies during the year.

Engagement with Stakeholder Outcomes and decisions based on engagement

Shareholders

The key methods of engaging with

Shareholders are as follows:

• Annual General Meeting (“AGM”)

• Shareholder seminar

• Annual report and Financial

Statements, Half-yearly financial

report, and Interim management

statements

• RNS announcements for all key

decisions including changes to the

Board, and the publication of a

Prospectus in relation to the Top up

Offers

• Albion Capital website, social media

pages, as well as publishing Albion

News shareholder magazine

• A briefing from the Company’s broker

and sponsor

• Shareholders’ views are important. The Board encourages Shareholders to exercise

their right to vote on the resolutions at the AGM or any other General Meetings

of the Company. The Company’s AGM is used as an opportunity to communicate

with investors, including through a presentation made by the investment

management team. The Board has decided that this year’s AGM will be held

virtually, via Lumi platform, which enabled engagement with a wider audience

of shareholders from across the country, and gave shareholders the opportunity

to ask questions and vote during the AGM last year. The virtual medium helps

facilitate greater shareholder participation and to help those who are unable to

attend the AGM in person.

• Shareholders are also encouraged to attend in person the annual Shareholders’

Seminar. This year’s event took place on 23 November 2022 at the Royal College

of Surgeons. The seminar included Speechmatics and Ophelos sharing insights

into their businesses and also a Q&A from Albion executives on some of the key

factors affecting the investment outlook, as well as a review of the past year and

the plans for the year ahead. Representatives of the Board attended the seminar.

The Board considers this an important interactive event and expects to continue

to run this in 2023.

• The Board recognises the importance to shareholders of maintaining and applying

a share buy-back policy, in order to provide market liquidity. The Board closely

monitors the discount to the net asset value, with a target to maintain this in the

region of 5%.

• The Board seeks to create value for shareholders by generating strong and

sustainable returns to provide shareholders with regular dividends and the

prospect of capital growth. The Board takes this into consideration when making

the decision to pay dividends to shareholders. The variable dividend policy has

resulted in a dividend yield of 4.9% on opening net asset value, with dividends

paid semi-annually.

• During the year, the Board made the decision to participate in the Albion

Prospectus Top Up Offers, launched on 6 January 2022 and 10 October 2022,

to raise more funds for deployment into new and existing portfolio companies.

The Board carefully considered whether further funds were required, whether

the VCT tests would continue to be met and whether it would be in the interest

of shareholders, before agreeing to participate in the Top up Offers. On allotting

shares, an issue price formula based on the prevailing net asset value is used to

ensure there is no dilution to existing Shareholders.

• Cash management and liquidity of the Company are key quarterly discussions

with the Board, focusing on deployment of cash for future investments, dividends

and share buy-backs and the prospect of future realisations in the portfolio.

• The Board decided to propose a special resolution at the 2022 AGM to increase

the Company’s distributable reserves by way of a reduction of share premium

account and capital redemption reserve. This resolution was approved with 99.4%

of Shareholders voting in favour of the resolution. Further details on this can be

found on page 51.

21Albion Technology & General VCT PLC

Engagement with Stakeholder Outcomes and decisions based on engagement

Manager

The performance of Albion Capital

Group LLP is essential to the long term

success of the Company, including

achieving the investment policy and

generating returns to shareholders,

as well as the impact the Company

has on Environment, Social and

Governance practice.

• The Manager meets with the Board at least quarterly to discuss the performance

of the Company, and is in regular contact in between these meetings, for example

to share investment papers for new and follow-on investments. All strategic

decisions are discussed in detail and minuted, with an open dialogue between the

Board and the Manager.

• The performance of the Manager in managing the portfolio and in providing

company secretarial, administration and accounting services is reviewed in detail

each year by the Management Engagement Committee, which includes reviewing

comparator engagement terms and portfolio performance.

• There was a change in the year to the management fees and to the performance

incentive fee which is now calculated by reference to the Company’s five year

rolling historic returns commencing from 2019 and with any fee first payable

in 2024. A provision of £272,000 has been recognised based on the Directors’

best estimate of incentive fees potentially earned to date based on historic

performance.

• Details of the Manager’s responsibilities can be found in the Statement of

corporate governance on pages 54 and 55.

Suppliers

The key suppliers with regular

engagement with the Company often

through the Manager are:

• Corporate broker

• VCT taxation adviser

• Depositary

• Registrar

• External auditor

• Lawyer

• The Manager is in regular contact with the suppliers. The contractual

arrangements with all the principal suppliers to the Company are reviewed

regularly and formally once a year, alongside the performance of the suppliers in

acquitting their responsibilities.

• The Board reviews the performance of the providers annually in conjunction with

the Manager’s input, and was satisfied with the suppliers’ performances.

Portfolio companies

The portfolio companies are

considered key stakeholders, because

they are principal drivers of value for

the Company. As discussed in the

Environmental, Social and Governance

(“ESG”) report on pages 36 to 39,

the portfolio companies’ impact on

their own stakeholders and the wider

community is also important to the

Company.

• The Board aims to have a diversified portfolio in terms of sector and stage of

investment. Further details of this can be found in the pie charts on pages 14

and 15.

• In most cases, an Albion executive is on the board of a portfolio company, to help

with both business operational decisions, as well as good ESG practices.

• The AlbionVC platform team provide access to deep expertise on growth strategy

alignment, leadership team hiring, organisational scaling and founder leader

development.

• The Manager ensures good dialogue with portfolio companies, and often holds

events to help portfolio companies benefit from the Albion network.

Community and environment

The Company as an investment

company, with no employees and no

customers, has no direct effect itself

on the community and environment.

However, as discussed above, the

portfolio companies’ ESG impact is

extremely important to the Board and

considered as part of the review of

Company operations.

• The Board receives reports on ESG factors within its portfolio from the Manager.

The Manager is a signatory of the United Nations Principles for Responsible

Investment (“UN PRI”). Further details of this are set out in the ESG report on

pages 36 to 39. ESG, without its specific definition, has always been at the heart

of the responsible and sustainable investing that the Company engages in and in

how the Company conducts itself with all of its stakeholders.

Albion Technology & General VCT PLC 22

Strategic report

Social and community issues, employees

and human rights

The Board recognises the requirement under section

414C of the Companies Act 2006 (the “Act”) to detail

information about social and community issues,

employees and human rights; including any policies it

has in relation to these matters and the effectiveness

of these policies. As an externally managed investment

company with no employees, the Company has no

requirement for formal policies in these matters,

however, it is at the core of its responsible investment

approach.

General Data Protection Regulation

(“GDPR”)

The General Data Protection Regulation has the

objective of unifying data privacy requirements across

the European Union. GDPR forms part of the UK law

after Brexit, now known as UK GDPR. The Manager

continues to take action to ensure that the Manager

and the Company are compliant with the regulation.

Further policies

The Company has adopted a number of further policies

relating to:

• Environment

• Global greenhouse gas emissions

• Anti-bribery

• Anti-facilitation of tax evasion

• Diversity

These are set out in the Directors’ report on page 49.

Risk management

The Board carries out a regular review of the risk

environment in which the Company operates, together

with changes to the environment and individual

risks. The Board also identifies emerging risks which

might affect the Company. In the year ended 31

December 2022 the most noticeable continuing

risk to operational and investment risk has been the

heightened geopolitical risk and its effect on the

economy, with inflation remaining high, interest rates

increasing and pricing volatility in world markets,

particularly affecting growth stocks. The full impact

on the Company’s portfolio is likely to be uncertain for

some time.

The Board has carried out a robust assessment of

the Company’s principal risks and uncertaintiesand

seeks to mitigate these risks throughregular reviews

of performance and monitoring progress and

compliance. The Board applies the principles detailed

in the Financial Reporting Council’s Guidance on

Risk Management, Internal Control and Related

Financial and Business Reporting, in the mitigation

and management of these risks. More information on

specific mitigation measures for the principal risks and

uncertainties are explained below:

The Board has

carried out a robust

assessment of the

Company’s principal

risks and uncertainties.

23Albion Technology & General VCT PLC

Possible consequence Risk assessment

during the year

Risk management

RISK: Investment, performance and valuation risk

The risk of investment in poor

quality businesses, which

could reduce the returns

to shareholders and could

negatively impact on the

Company’s current and future

valuations.

By nature, smaller unquoted

businesses, such as those that

qualify for Venture Capital

Trust investment purposes, are

more volatile than larger, long-

established businesses.

The Company’s investment policy

creates concentration risk to

the technology sector (including

FinTech and HealthTech), as well

as to the health sector generally.

The Company’s investment

valuation methodology is

reliant on the accuracy and

completeness of information

that is issued by portfolio

companies. In particular, the

Directors may not be aware of or

take into account certain events

or circumstances which occur

after the information issued by

such companies is reported.

Increased in

the year due to

the heightened

economic and

geopolitical issues

as referred to

above.

Earlier stage

technology

companies have

suffered from

a particularly

significant de-

rating in the past

9 months, and

volatility continues

to be seen in

valuations for these

types of assets.

To reduce this risk, the Board places reliance upon the skills and

expertise of the Manager and its track record over many years of

making successful investments in this segment of the market. In

addition, the Manager operates a formal and structured investment

appraisal and review process, which includes an Investment

Committee, comprising investment professionals from the

Manager for all investments, and at least one external investment

professional for investments greater than £1 million in aggregate

across all the Albion managed VCTs. The Manager also invites

and takes account of comments from non-executive Directors of

the Company on matters discussed at the Investment Committee

meetings.

Investments are actively and regularly monitored by the Manager

(investment managers normally sit on portfolio company boards),

including the level of diversification in the portfolio, and the

Board receives detailed reports on each investment as part of the

Manager’s report at quarterly board meetings. The Board and

Manager regularly review the deployment of investments and cash

resources available to the Company in assessing liquidity required

for servicing the Company’s buy-backs, dividend payments and

operational expenses. The decision to issue a Prospectus for the

2021/22 and 2022/23 Top-Ups followed careful analysis of these

factors.

The unquoted investments held by the Company are designated

at fair value through profit or loss and valued in accordance

with the International Private Equity and Venture Capital

Valuation Guidelines updated in 2022. These guidelines set out

recommendations, intended to represent current best practice on

the valuation of venture capital investments. The valuation takes

into account all known material facts up to the date of approval of

the Financial Statements by the Board.

RISK: VCT approval risk

The Company must comply

with section 274 of the Income

Tax Act 2007 which enables its

investors to take advantage of

tax relief on their investment

and on future returns. Breach

of any of the rules enabling the

Company to hold VCT status

could result in the loss of that

status.

No change in the

year.

To reduce this risk, the Board has appointed the Manager, which

has a team with significant experience in Venture Capital Trust

management, used to operating within the requirements of the

Venture Capital Trust legislation. In addition, to provide formal

assurance, the Board has appointed Philip Hare & Associates

LLP as its taxation adviser, who report quarterly to the Board to

independently confirm compliance with the Venture Capital Trust

legislation, and highlight areas of risk and to inform on changes in

legislation. Each investment in a new portfolio company is also pre-

cleared with our professional advisers or H.M. Revenue & Customs.

The Company monitors closely the extent of qualifying holdings and

addresses this as required.

Albion Technology & General VCT PLC 24

Possible consequence Risk assessment

during the year

Risk management

RISK: Cyber and data security

The Company relies on a number

of third parties, in particular

the Manager, for the provision

of investment management

and administrative functions.

Failures in key IT systems and

controls within the Manager’s

business could place assets of

the Company at risk, result in

loss of sensitive data (including

shareholder data), or loss of

access to systems resulting in a

lack of timely communication to

market.

No change in the

year.

The Manager has a dedicated in-house IT support to assist in the

management of the IT infrastructure and improve the IT control

environment.

The Company and its operations are subject to a series of rigorous

internal controls and review procedures exercised throughout the year.

The Board receives reports from the Manager on its internal controls

and risk management, including on matters relating to cyber security.

The Audit and Risk Committee reviews the Internal Audit Reports

prepared by the Manager’s internal auditors, Azets and has access

to their internal audit partner to whom it can ask specific detailed

questions in order to satisfy itself that the Manager has sufficient

systems and controls in place including those in relation to business

continuity and cyber security.

The Manager also has a formal risk group in place which meets every

six months, with cyber risk being discussed at Board meetings.

RISK: Reliance on key agents and personnel

The Company relies on a number

of third parties, in particular the

Manager, for the provision of

investment management and

administrative functions. Failures

in key systems and controls or

loss of key personnel, within the

Manager’s business could put

assets of the Company at risk or

result in reduced or inaccurate

information being passed to the

Board or to shareholders.

No change in the

year.

Ocorian Depositary (UK) Limited is the Company’s Depositary,

appointed to oversee the custody and cash arrangements and

provide other AIFMD duties. The Board reviews the quarterly reports

prepared by Ocorian Depositary (UK) Limited to ensure that the

Manager is adhering to its policies and procedures as required by

the AIFMD.

In addition, the Board annually reviews the performance of its key

service providers, particularly the Manager, to ensure they continue

to have the necessary expertise and resources to deliver the

Company’s investment objective and policy. The Manager and other

service providers have also demonstrated to the Board that there is

no undue reliance placed upon any one individual.

RISK: Economic, political and social risk

Changes in economic conditions,

including; higher interest rates,

rates of inflation, industry

conditions, competition, political

and diplomatic events, and other

factors could substantially and

adversely affect the Company’s

prospects in a number of ways.

This also includes risks of

social upheaval, including from

infection and population re-

distribution, as well as economic

risk challenges as a result of

healthcare pandemics/infection.

Increased in the

year, due to the

high levels of

inflation, rising

interest rates and

the geopolitical

risks from the

invasion of Ukraine.

The Company invests in a diversified portfolio of companies across a

number of industry sectors and in addition often invests in a mixture

of instruments in portfolio companies and has a policy of minimising

any external bank borrowings within portfolio companies.

At any given time, the Company has sufficient cash resources to meet

its operating requirements, including share buy-backs and follow-on

investments.

In common with most commercial operations, exogenous risks over

which the Company has no control are always a risk and the Company

does what it can to address these risks where possible, not least as the

nature of the investments the Company makes are long term.

The Board and Manager continuously assess the resilience of the

portfolio, the Company and its operations and the robustness of

the Company’s external agents, as well as considering longer term

impacts on how the Company might be positioned in how it invests

and operates. Ensuring liquidity in the portfolio to cope with exigent

and unexpected pressures on the finances of the portfolio and the

Company is an important part of the risk mitigation in uncertain times.

The portfolio is diversified and exposure is relatively small to at-risk

sectors that include leisure, hospitality, retail and travel.

25Albion Technology & General VCT PLC

Strategic report

Possible consequence Risk assessment

during the year

Risk management

RISK: Discount risk

The market value of Ordinary

shares can fluctuate. The market

value of an Ordinary share, as

well as being affected by its

net asset value (“NAV”) and

prospective NAV, also takes into

account its dividend yield and

prevailing interest rates. As such,

the market value of an Ordinary

share may vary considerably

from its underlying NAV. The

market prices of shares in

quoted investment companies

can, therefore, be at a discount

or premium to the NAV at

different times, depending on

supply and demand, market

conditions, general investor

sentiment and other factors,

including the ability to exercise

share buybacks. Accordingly,

the market price of the Ordinary

shares may not fully reflect their

underlying NAV.

No change in the

year.

The Company operates a share buy-back policy, which aims to limit

the discount at which the shares trade to around 5% to NAV, by

providing a purchaser through the Company in absence of market

purchasers. From time to time buy-backs cannot be applied, for

example when the Company is subject to a close period, or if it were

to exhaust and could not renew any buyback authorities.

New Ordinary shares are issued at sufficient premium to NAV to

cover the costs of issue and to avoid asset value dilution to existing

investors.

Strategic report

Viability statement

In accordance with the FRC UK Corporate Governance

Code published in 2018 and provision 36 of the AIC

Code of Corporate Governance, the Directors have

assessed the prospects of the Company for the three

years to 31 December 2025. The Directors believe

that three years is a reasonable period in which they

can assess the ability of the Company to continue to

operate as a going concern and meet its liabilities as

they fall due. This is the period used by the Board as

part of its strategic planning process, which includes:

the estimated timelines for finding, assessing and

completing investments; the potential impact of any

new regulations; and the availability of cash.

As noted above, the Board has carried out a robust

assessment of the principal and emerging risks facing

the Company, including those that could threaten

its business model, future performance, solvency or

liquidity, and focused on the major factors which affect

the economic, regulatory and political environment.

The Board also considered the procedures in place

to identify emerging risks and the risk management

processes in place to avoid or reduce the impact of the

underlying risks. The Board carefully assessed, and was

satisfied with, the risk management processes in place

to avoid or reduce the impact of these risks. Inflation

remaining high, interest costs increasing and the impact

on growth stocks against a geopolitically uncertain

environment remain risks that need to be considered

against the practical management of the Company’s

net assets and its operational requirements. The Board

has carried out robust stress testing of cashflows

which included; factoring in higher levels of inflation

when budgeting for future expenses; only including

proceeds from investment disposals where there is a

high probability of completion; assessing the resilience

of portfolio companies given the current decline in

the global economy, including the requirement for any

future financial support; and the ability to fulfil interest

requirements on debt instruments.

The Board assessed the ability of the Company to

raise finance and deploy capital, as well as the existing

cash resources of the Company by looking at cashflow

forecasts and the future pipeline of investments. The

Board has additionally considered the ability of the

Company to comply with the ongoing conditions to

ensure it maintains its VCT qualifying status under its

current investment policy. As a result of the Board’s

quarterly valuation reviews, it has concluded that the

portfolio is well balanced and geared towards delivering

long term growth and strong returns to shareholders. In

assessing the prospects of the Company, the Directors

have considered the cash flow by looking at the

Company’s income and expenditure projections and

funding pipeline over the assessment period of three

years and they appear realistic. It is also satisfied that

the Company can maintain its VCT qualifying status.

Taking into account the processes for mitigating risks,

monitoring costs, implementing share buy-backs and

issuance of new shares, the Manager’s compliance

with the investment objective, achievement of the VCT

qualifying status, policies and business model and the

balance of the portfolio, the Board has concluded that

there is a reasonable expectation that the Company

will be able to continue in operation and meet its

liabilities as they fall due over the three year period

to 31 December 2025. The Board is mindful of the

ongoing and emerging risks and will continue to ensure

that appropriate safeguards are in place, in addition

to monitoring the quarterly cashflow forecasts to

ensure the Company has sufficient liquidity to meet its

operational and investment needs.

Companies Act 2006

This Strategic report of the Company for the year

ended 31 December 2022 has been prepared in

accordance with the requirements of section 414A of

the Companies Act 2006 (the “Act”). The purpose of

this report is to provide Shareholders with sufficient

information to enable them to assess the extent to

which the Directors have performed their duty to

promote the success of the Company in accordance

with Section 172 of the Act.

For and on behalf of the Board

Robin Archibald

Chairman

6 April 2023

27Albion Technology & General VCT PLC

Strategic report

PORTFOLIO OF INVESTMENTS

As at 31 December 2022 As at 31 December 2021

Change in value

for the year*

£’000

Fixed asset investments

% voting rights

% voting rights of Albion

managed companies

Cost

£’000

Cumulative movement

in value

£’000

Value

£’000

Cost

£’000

Cumulative movement

in value

£’000

Value

£’000

Quantexa 2.9 11.3 2,740 14,193 16,933 2,740 14,193 16,933 -

Radnor House School (TopCo) 14.8 48.3 2,710 2,535 5,245 2,710 2,999 5,709 (464)

Proveca 7.2 49.9 1,184 3,546 4,730 1,184 3,635 4,819 (89)

Oviva 2.9 12.2 2,694 1,608 4,302 2,694 2,700 5,394 (1,092)

Chonais River Hydro 15.7 50.0 2,169 1,864 4,033 2,169 1,625 3,794 239

Cantab Research (T/A Speechmatics) 3.4 14.4 2,901 917 3,818 1,486 735 2,221 182

The Evewell Group 6.4 33.0 1,547 1,590 3,137 1,547 1,522 3,069 68

Egress Software Technologies 2.2 24.7 765 2,193 2,958 765 2,259 3,024 (66)

Runa Network (previously WeGift) 3.3 13.9 2,101 591 2,692 1,020 - 1,020 591

Gharagain River Hydro 18.5 50.0 1,526 789 2,315 1,526 620 2,146 169

Black Swan Data 8.3 26.1 4,714 (2,454) 2,260 3,268 (366) 2,902 (2,088)

Convertr Media 6.9 26.6 1,105 1,056 2,161 1,105 45 1,150 1,011

Elliptic Enterprises 1.6 5.9 2,156 - 2,156 2,156 804 2,960 (804)

Panaseer 3.1 11.4 1,122 815 1,937 1,122 534 1,656 281

Healios 2.5 17.5 1,500 417 1,917 633 417 1,050 -

MHS1 22.5 48.8 1,565 93 1,658 1,565 (257) 1,308 350

TransFICC 2.7 13.0 1,275 377 1,652 397 377 774 -

Threadneedle Software Holdings (T/A

Solidatus) 1.7 11.5 1,014 617 1,631 1,014 - 1,014 617

The Street by Street Solar Programme 8.1 50.0 895 648 1,543 895 597 1,492 51

Peppy Health 1.6 8.7 1,481 - 1,481 - - - -

Toqio FinTech Holdings (T/A Toqio) 2.0 10.4 1,400 - 1,400 - - - -

Regenerco Renewable Energy 7.9 50.0 822 498 1,320 822 472 1,294 26

Locum’s Nest 6.9 25.6 813 370 1,183 675 41 716 329

Aridhia Informatics 4.9 21.6 950 227 1,177 950 290 1,240 (63)

Gravitee Topco (T/A Gravitee.io) 2.2 18.1 920 235 1,155 490 - 490 235

Beddlestead 9.8 49.0 1,200 (84) 1,116 1,200 34 1,234 (118)

InCrowd Sports 4.8 17.2 749 313 1,062 636 219 855 94

PeakData 2.1 11.2 943 71 1,014 - - - 71

The Q Garden Company 33.4 50.0 934 65 999 934 (150) 784 215

GX Molecular (T/A CS Genetics) 2.9 14.8 846 - 846 - - - -

NuvoAir Holdings 1.4 11.2 564 272 836 443 186 629 86

Alto Prodotto Wind 6.9 50.0 530 206 736 567 204 771 24

Seldon Technologies 1.4 14.0 694 - 694 283 - 283 -

OutThink 2.7 13.9 687 - 687 - - - -

PerchPeek 2.0 13.6 635 - 635 - - - -

Neurofenix 19.7 14.8 590 - 590 - - - -

DiffBlue 2.5 12.9 585 - 585 - - - -

Albion Technology & General VCT PLC 28