Octopus Apollo VCT Plc
Half-Yearly Results
19 September 2019
Octopus Apollo VCT plc, managed by Octopus Investments Limited, today announces its unaudited half-yearly results for the six months ended 31 July 2019.
These results were approved by the Board of Directors on 19 September 2019.
You may, in due course, view the Half-Yearly report in full at www.octopusinvestments.com. All other statutory information can also be found there.
Financial Headlines
| |
Six months to
31 July 2019 |
Six months to
31 July 2018 |
Year to
31 January 2019 |
| Net assets (£’000s) |
122,093 |
122,252 |
119,024 |
| Return on ordinary activities after tax (£’000s) |
1,433 |
(3,038) |
(1,183) |
| Net asset value per share (‘NAV’) |
46.2 |
47.9 |
47.1 |
| Cumulative dividends paid since launch (p per share) |
72.6 |
69.6 |
71.1 |
| NAV plus cumulative dividends paid (p) |
118.8 |
117.5 |
118.2 |
| Total return %* |
1.3 |
(2.2) |
(0.8) |
| Ordinary dividend paid in period (p) |
1.5 |
1.6 |
3.1 |
| Ordinary dividend declared in the period (p) |
1.5 |
1.5 |
1.5 |
*Total return is calculated as (movement in NAV + dividends paid in the period) divided by the NAV at the beginning of the period.
The interim dividend will be paid on 9 January 2020 to shareholders on the register at 20 December 2019.
Chairman’s Statement
I am pleased to present the half-yearly report of Octopus Apollo VCT for the six months ended 31 July 2019.
On a total return basis, after adding back the 1.5p dividend paid in the period, the NAV has increased 1.3% during the six months. In keeping with the regular dividend policy, your Board has declared an interim dividend of 1.5p which will be paid to shareholders on 9 January 2020.
During the period the majority of the portfolio performed broadly in line with expectations leading to an increase in value of £1.8 million as explained in detail in the next section. This increase in value resulted in a profit of £1.4 million for the company, net of investment income and management expenses.
The Company invested £7.2 million into new companies in the period, as well as £4.3 million of follow-on funding rounds into five existing investments, with further investments made after the end of the period. The overall performance in the period has shown an improvement and a return to profitability, although the political and economic uncertainty resulting from Brexit negotiations still persists. I remain cautiously optimistic for the future. Lastly, the Company’s current fundraising is ongoing and we are confident of raising sufficient new capital to fund our exciting pipeline of future opportunities.
Murray Steele
Chairman
19 September 2019
Interim Management Report
Performance
In the six months under review the Total Return, after adding back the 1.5p of dividends paid in the period, has increased 1.3%. This performance is attributable to a combination of the continuation of the strong interest yield from loans made to portfolio companies and positive fair value movements across most of the portfolio, offset by adverse movements in the fair value of a small number of legacy assets in the portfolio.
Portfolio Activity
In the period under review the value of the portfolio has increased by £1.8 million, excluding additions and disposals. This increase is mainly driven by Natterbox (N2JB Limited) (£2.8 million valuation increase), Ubisecure (£1.5 million valuation increase) and ISG Technology (Coupra Limited) (£1.9 million valuation increase) partially offset by valuation decreases of £4.0 million on the Reserve Power portfolio (Kabardin Limited, Valloire Power Limited and Red Poll Power Limited) and £2.2 million on Oxifree. Other smaller valuation adjustments across the portfolio also contributed to the overall increase in the value of the portfolio.
During the period £11.5 million was invested, £7.2 million of which was into the following new investments:
• Rotolight £3.9 million – a designer and producer of LED lighting, which sells patent-protected flash and lighting products to photographers, filmmakers and broadcasters; and
• Veeqo £3.3 million – an inventory management software company focused on the SME e-commerce retail sector.
The remaining £4.3 million invested was to provide growth funding to five existing portfolio companies including £2.1 million invested into Ubisecure and £1.5 million invested into Natterbox to continue to support each business’ growth plans.
In July 2019 we saw the successful acquisition of City Pantry Limited by Just Eat plc. This exit saw total proceeds of £4.9 million to Apollo, a gain of £1.5 million on the previous valuation and a record IRR for an Apollo investment. We also sold our investment in Tanganyika Heat Limited realising a small loss on the disposal.
Transactions with Manager
Details of amounts paid to the Manager are disclosed in note 7 to the financial statements.
Share Buybacks
The Company has continued to buy back shares as required. In the six months to July 2019, the Company bought back 5,517,197 Ordinary shares for total consideration of £2.5 million.
Share Issues and Fundraising
An Offer for Subscription was launched in May 2019 to raise up to £20 million and is expected to be open till December 2019 for prospective shareholders.
Dividend and Dividend Policy
It is the Board’s policy to maintain a regular dividend flow where possible in order to take advantage of the tax free distributions a VCT is able to provide.
The Board has declared an interim dividend of 1.5p per share in respect of the period ended 31 July 2019. The dividend will be payable on 9 January 2020 to Ordinary shareholders on the register at 30 December 2019.
VCT Qualifying Status
PricewaterhouseCoopers LLP provides the Board and Investment Manager with advice concerning ongoing compliance with Her Majesty’s Revenue & Customs (‘HMRC’) rules and regulations concerning VCTs. The Board has been advised that the Company is in compliance with the conditions set by HMRC for maintaining approval as a VCT.
A key requirement is to ensure that at least 70% of the assets of the fund are in VCT qualifying investments. As at 31 July 2019, 95.1% of the portfolio, as measured by HMRC rules, was invested in VCT qualifying investments.
The Finance Act 2018 made a number of changes to VCT rules on qualifying holdings, with the main change being VCTs are now required to hold at least 80% of its investments in VCT qualifying holdings, up from 70%. This applies to accounting periods starting on or after 6 April 2019, so for Apollo these rules will apply from 1st February 2020.
Principal Risks and Uncertainties
The principal risks and uncertainties are set out in note 6 to the financial statements.
Summary and Future Prospects
The political and economic environment continues to be very uncertain in the UK as a result of protracted exit negotiations with the European Union. To date there has been little, if any, negative impact on the portfolio and the investment team remains vigilant in monitoring the situation carefully and any potential impact, directly or indirectly, on the portfolio. The overall Company performance has been modest during the period primarily as a result of specific trading performance issues in a limited number of legacy investments which were offset by a strong performance across the rest of the portfolio. On a positive note, the investments completed after the significant change in VCT rules in 2017 are performing in line with expectations and are now the largest positive contributor to the overall profit of the Company, which provides further optimism for the future. The investment team has continued the steady pace of new investments and continues to source an active pipeline of new VCT qualifying investment opportunities.
Richard Court
Octopus Investments Limited
19 September 2019
Investment Portfolio
| |
Sector |
Investment cost as at 31 July 2019 £’000 |
Movement in fair value to 31 July 2019
£’000 |
Fair value as at 31 July 2019 £’000 |
Movement in fair value in period
£’000 |
% equity held by Apollo VCT |
% equity held by all funds managed by Octopus |
| Fixed asset investments |
|
|
|
|
|
|
|
| Natterbox (N2JB Limited) |
Technology |
6,490 |
3,185 |
9,675 |
2,774 |
9.0 |
9.0 |
| Healthcare and Services Technology Limited |
Healthcare & Education |
7,186 |
1,130 |
8,316 |
(66) |
10.0 |
10.0 |
| Ubisecure Holdings Limited |
Technology |
4,250 |
1,687 |
5,937 |
1,461 |
30.0 |
30.0 |
| Coupra Limited (ISG) |
Information Technology |
5,000 |
878 |
5,878 |
1,891 |
9.8 |
9.8 |
| Anglo European Group Limited |
Manufacturing & Engineering |
5,000 |
291 |
5,291 |
195 |
26.7 |
26.7 |
| Countrywide Healthcare Services Holdings Limited |
Healthcare & Education |
2,675 |
2,315 |
4,990 |
81 |
20.7 |
20.7 |
| Simply Cook Limited |
Consumer Goods |
4,500 |
– |
4,500 |
- |
16.4 |
16.4 |
| Rotolight Group Ltd |
Consumer Goods |
3,850 |
371 |
4,221 |
371 |
15.3 |
15.3 |
| Veeqo Limited |
Technology |
3,300 |
167 |
3,467 |
167 |
19.8 |
19.8 |
| Care & Independence (Dyscova Limited) |
Healthcare & Education |
4,700 |
(1,626) |
3,074 |
- |
62.2 |
62.2 |
| Other* |
Various |
44,449 |
(6,426) |
38,023 |
(5,025) |
|
|
| Total fixed asset investments |
|
91,400 |
1,972 |
93,372 |
1,849 |
|
|
| |
|
|
|
|
|
|
|
| Current asset investments |
|
|
|
|
|
|
|
| Octopus Portfolio Manager – Cash |
9,251 |
103 |
9,354 |
34 |
|
|
| Octopus Portfolio Manager – Cash Plus |
3,830 |
383 |
4,213 |
145 |
|
|
| Total current asset investments |
|
13,081 |
486 |
13,567 |
179 |
|
|
| Total fixed and current asset investments |
|
|
106,939 |
|
|
|
| Cash at bank |
|
|
|
20,288 |
|
|
|
| Debtors less creditors |
|
|
|
(5,134) |
|
|
|
| Total net assets |
|
|
|
122,093 |
|
|
|
* Comprises 40 other investments: Acquire Your Business Limited, Angelico Solar Limited, Artesian Solutions Limited, Augean plc, Barrecore Limited, Behaviometrics AB, Bramante Solar Limited, British Country Inns plc, Canaletto Solar Limited, Cello Group plc, CurrencyFair Limited, Ecrebo Limited, EKF Diagnostics Holdings plc, Ergomed plc, Eve Sleep plc, Hasgrove Limited, Kabardin Limited, Leonardo Solar Limited, Luther Pendragon Limited, Mi-Pay Group plc, Modigliani Solar Limited, Nektan plc, Origami Energy Limited, Oxifree Group Holding Limited, Pirlo Solar Limited, Red Poll Power Limited, Renalytix plc, Secret Escapes Limited, Segura Systems Limited, Sourceable Limited (Swoon Editions), Superior Heat Limited, Synnovia plc, Tintoretto Solar Limited, Tiziano Solar Limited, Trafi Limited, Triumph Holdings Limited, Valloire Power Limited, Vertu Motors plc, Winnipeg Heat Limited, Zynstra Limited.
Directors’ Responsibilities Statement
We confirm that to the best of our knowledge:
• the half-yearly financial statements have been prepared in accordance with the Financial Reporting Standard 104 “Interim Financial Reporting” issued by the Financial Reporting Council;
• the half-yearly financial statements give a true and fair view of the assets, liabilities, financial position, and profit or loss of the Company;
• the half-yearly report includes a fair review of the information required by the Financial Conduct Authority’s Disclosure and Transparency Rules, being:
• an indication of the important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements;
• a description of the principal risks and uncertainties for the remaining six months of the year; and
• a description of related party transactions that have taken place in the first six months of the current financial year, that may have materially affected the financial position or performance of the Company during that period and any changes in the related party transactions described in the last annual report that could do so.
On behalf of the Board
Murray Steele
Chairman
19 September 2019
Income Statement
| |
Unaudited |
Unaudited |
Audited |
| |
Six months to 31 July 2019 |
Six months to 31 July 2018 |
Year to 31 January 2019 |
| |
Revenue
£’000 |
Capital
£’000 |
Total
£’000 |
Revenue
£’000 |
Capital
£’000 |
Total
£’000 |
Revenue
£’000 |
Capital
£’000 |
Total
£’000 |
| Realised gain/(loss) on disposal of fixed asset investments |
– |
6 |
6 |
– |
889 |
889 |
– |
(531) |
(531) |
| Realised gain/(loss) on disposal of current asset investments |
– |
46 |
46 |
_ |
(6) |
(6) |
_ |
(127) |
(127) |
| Change in fair value of fixed asset investments |
– |
1,849 |
1,849 |
– |
(3,236) |
(3,236) |
– |
302 |
302 |
| Change in fair value of current asset investments |
– |
179 |
179 |
– |
38 |
38 |
– |
– |
– |
| Investment income |
1,573 |
– |
1,573 |
1,638 |
– |
1,638 |
3,469 |
139 |
3,608 |
| Investment management fees (see note 7) |
(266) |
(1,932) |
(2,198) |
(310) |
(929) |
(1,239) |
(545) |
(1,634) |
(2,179) |
| Other expenses |
(22) |
– |
(22) |
(1,122) |
– |
(1,122) |
(2,256) |
– |
(2,256) |
| FX translation |
– |
– |
– |
– |
- |
- |
– |
4 |
4 |
| Profit/(loss) before tax |
1,285 |
148 |
1,433 |
206 |
(3,244) |
(3,038) |
668 |
(1,851) |
(1,183) |
| Tax |
– |
– |
– |
– |
– |
– |
– |
– |
– |
| Profit/(loss) after tax |
1,285 |
148 |
1,433 |
206 |
(3,244) |
(3,038) |
668 |
(1,851) |
(1,183) |
| Earnings per share – basic and diluted |
0.5p |
0.1p |
0.6p |
0.1p |
(1.3)p |
(1.2)p |
0.3p |
(0.7)p |
(0.4)p |
• The ‘Total’ column of this statement is the profit and loss account of the Company; the supplementary revenue return and capital return columns have been prepared under guidance published by the Association of Investment Companies.
• All revenue and capital items in the above statement derive from continuing operations.
• The Company has only one class of business and derives its income from investments made in shares and securities and from bank and money market funds.
• The Company has no recognised gains or losses other than those disclosed in the income statement.
• The accompanying notes are an integral part of the half-yearly report.
Balance Sheet
| |
Unaudited
As at 31 July 2019 |
Unaudited
As at 31 July 2018 |
Audited
As at 31 January 2019 |
| |
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
| Fixed asset investments |
|
93,372 |
|
77,078 |
|
86,538 |
| Current assets: |
|
|
|
|
|
|
| Investments |
13,567 |
|
41,501 |
|
18,342 |
|
| Debtors |
2,405 |
|
2,307 |
|
2,580 |
|
| Cash at bank |
20,288 |
|
2,960 |
|
13,203 |
|
| |
32,260 |
|
46,768 |
|
34,125 |
|
| Creditors: amounts falling due within one year |
(7,539) |
|
(1,594) |
|
(1,639) |
|
| Net current assets |
|
28,721 |
|
45,174 |
|
32,486 |
| Net assets |
|
122,093 |
|
122,252 |
|
119,024 |
| |
|
|
|
|
|
|
| Share capital |
|
26,430 |
|
25,537 |
|
25,250 |
| Share premium |
|
59,620 |
|
52,729 |
|
53,256 |
| Special distributable reserve |
|
23,142 |
|
34,690 |
|
29,602 |
| Capital redemption reserve |
|
4,465 |
|
3,482 |
|
3,914 |
| Capital reserve realised |
|
4,691 |
|
10,164 |
|
7,698 |
| Capital reserve unrealised |
|
2,460 |
|
(4,556) |
|
(696) |
| Revenue reserve |
|
1,285 |
|
206 |
|
– |
| Total equity shareholders’ funds |
|
122,093 |
|
122,252 |
|
119,024 |
| Net asset value per share |
|
46.2p |
|
47.9p |
|
47.1p |
* Increase in creditors relate to dividends, the Dividend Reinvestment Scheme and shares not alloted at the end of the period.
The statements were approved by the Directors and authorised for issue on 19 September 2019 and are signed on their behalf by:
Murray Steele
Chairman
Company Number: 05840377
Statement of Changes in Equity
| |
Share capital
£’000 |
Share premium
£’000 |
Special distributable reserves
£’000 |
Capital redemption reserve
£’000 |
Capital reserve realised
£’000 |
Capital reserve unrealised
£’000 |
Revenue reserve
£’000 |
Translation reserve
£’000 |
Total
£’000 |
| Six months to 31 July 2019 |
|
|
|
|
|
|
|
|
| As at 1 February 2019 |
25,250 |
53,256 |
29,602 |
3,914 |
7,698 |
(696) |
– |
– |
119,024 |
| Comprehensive income for the period: |
|
|
|
|
|
|
|
|
|
| Management fee allocated as capital expenditure |
– |
– |
– |
– |
(1,931) |
– |
– |
– |
(1,931) |
| Current period gains on disposal |
– |
– |
– |
– |
52 |
– |
– |
– |
52 |
| Current period losses on fair value of investments |
– |
– |
– |
– |
– |
2,028 |
– |
– |
2,472 |
| Profit after tax |
– |
– |
– |
– |
– |
– |
1,285 |
– |
1,285 |
| Total comprehensive income for the period |
– |
– |
– |
– |
(1,879) |
2,028 |
1,285 |
– |
1,878 |
| Contributions by and distributions to owners: |
|
|
|
|
|
|
|
|
|
| Repurchase and cancellation of own shares |
(551) |
– |
(2,478) |
551 |
– |
– |
– |
– |
(2,478) |
| Issue of shares |
1,731 |
6,364 |
– |
– |
– |
– |
– |
– |
8,095 |
| Dividends paid |
– |
– |
(3,982) |
– |
– |
– |
– |
– |
(3,982) |
| Total contributions by and distributions to owners |
1,180 |
6,364 |
(6,460) |
551 |
– |
– |
– |
– |
1,635 |
| Other movements: |
|
|
|
|
|
|
|
|
|
| Prior period holding gains/losses now realised |
– |
– |
– |
– |
(1,128) |
1,128 |
– |
|
– |
| Total other movements |
– |
– |
– |
– |
(1,128) |
1,128 |
– |
|
– |
| As at 31 July 2019 |
26,430 |
59,620 |
23,142 |
4,465 |
4,691 |
2,460 |
1,285 |
– |
122,093 |
| |
|
|
|
|
|
|
|
|
| |
Share Capital
£’000 |
Share Premium
£’000 |
Special distributable reserves
£’000 |
Capital Redemption Reserve
£’000 |
Capital reserve realised
£’000 |
Capital reserve unrealised
£’000 |
Revenue reserve
£’000 |
Translation reserve
£’000 |
Total
£’000 |
| Six months to 31 July 2018 |
|
|
|
|
|
|
|
|
| As at 1 February 2018 |
25,748 |
52,162 |
40,489 |
3,125 |
9,445 |
(602) |
– |
10 |
130,377 |
| Comprehensive income for the period: |
|
|
|
|
|
|
|
|
|
| Management fee allocated as capital expenditure |
– |
– |
– |
– |
(929) |
– |
– |
– |
(929) |
| Current period gains on disposal |
– |
– |
– |
– |
883 |
– |
– |
– |
883 |
| Current period losses on fair value of investments |
– |
– |
– |
– |
– |
(3,199) |
– |
– |
(3,199) |
| Profit after tax |
– |
– |
– |
– |
– |
– |
206 |
– |
206 |
| Total comprehensive income for the period |
– |
– |
– |
– |
(46) |
(3,199) |
206 |
– |
(3,039) |
| Contributions by and distributions to owners: |
|
|
|
|
|
|
|
|
|
| Repurchase and cancellation of own shares |
(357) |
– |
(1,706) |
357 |
– |
– |
– |
– |
(1,706) |
| Issue of shares |
146 |
567 |
– |
– |
– |
– |
– |
– |
713 |
| Dividends paid |
– |
– |
(4,093) |
– |
– |
– |
– |
– |
(4,093) |
| Total contributions by and distributions to owners |
(211) |
567 |
(5,799) |
357 |
– |
– |
– |
– |
(5,086) |
| Other movements: |
|
|
|
|
|
|
|
|
|
| Prior period holding gains/losses now realised |
– |
– |
– |
– |
765 |
(755) |
– |
(10) |
– |
| Total other movements |
– |
– |
– |
– |
765 |
(755) |
– |
(10) |
– |
| As at 31 July 2018 |
25,537 |
52,729 |
34,690 |
3,482 |
10,164 |
(4,556) |
206 |
- |
122,252 |
| |
Share Capital
£’000 |
Share Premium
£’000 |
Special distributable reserves
£’000 |
Capital Redemption Reserve
£’000 |
Capital reserve realised
£’000 |
Capital reserve unrealised
£’000 |
Revenue reserve
£’000 |
Translation reserve
£’000 |
Total
£’000 |
| Year to 31 January 2019 |
|
|
|
|
|
|
|
|
| As at 1 February 2018 |
25,748 |
52,162 |
40,489 |
3,125 |
9,445 |
(602) |
– |
10 |
130,377 |
| Comprehensive income for the year: |
|
|
|
|
|
|
|
|
|
| Management fee allocated as capital expenditure |
– |
– |
– |
– |
(1,634) |
– |
– |
– |
(1,634) |
| Current year gains on disposal |
– |
– |
– |
– |
(658) |
– |
– |
– |
(658) |
| Current year gains on fair value of investments |
– |
– |
– |
– |
– |
302 |
– |
– |
302 |
| In-specie dividend |
– |
– |
– |
– |
139 |
– |
– |
– |
139 |
| Profit after tax |
– |
– |
– |
– |
– |
– |
668 |
– |
668 |
| Total comprehensive income for the year |
– |
– |
– |
– |
(2,153) |
302 |
668 |
– |
(1,183) |
| Contributions by and distributions to owners: |
|
|
|
|
|
|
|
|
|
| Repurchase and cancellation of own shares |
(789) |
– |
(3,649) |
789 |
– |
– |
– |
– |
(3,649) |
| Issue of shares |
291 |
1,094 |
– |
– |
– |
– |
– |
– |
1,385 |
| Dividends paid |
– |
– |
(7,238) |
– |
– |
– |
(668) |
– |
(7,906) |
| Total contributions by and distributions to owners |
(498) |
1,094 |
(10,887) |
789 |
– |
– |
(668) |
– |
(10,170) |
| Other movements: |
|
|
|
|
|
|
|
|
|
| Prior year holding gains/losses now realised |
– |
– |
– |
– |
396 |
(396) |
– |
– |
– |
| Transfer of translation reserve |
– |
– |
– |
– |
10 |
– |
– |
(10) |
– |
| Total other movements |
– |
– |
– |
– |
406 |
(396) |
– |
(10) |
– |
| As at 31 January 2019 |
25,250 |
53,256 |
29,602 |
3,914 |
7,698 |
(696) |
– |
– |
119,024 |
Cash Flow Statement
| |
Unaudited
Six months to
31 July 2019
£’000 |
Unaudited
Six months to
31 July 2018
£’000 |
Audited
Year to
31 January 2019
£’000 |
| Cash flows from operating activities: |
|
|
|
| Profit/(loss) after tax |
1,433 |
(3,038) |
(1,183) |
| Adjustments for: |
|
|
|
| Decrease/(increase) in debtors |
176 |
(233) |
(506) |
| Increase/(decrease) in creditors |
1,918 |
(353) |
(308) |
| (Gain)/loss on disposal of fixed assets |
(6) |
(889) |
531 |
| (Gain)/loss on revaluation of fixed asset investments |
(1,849) |
3,236 |
(302) |
| (Gain)/loss on disposal of current assets |
(46) |
6 |
127 |
| Gain on revaluation of current asset investments |
(179) |
(38) |
_ |
| In-specie dividend |
- |
- |
(139) |
| Cash from operations |
1,447 |
(1,309) |
(1,780) |
| Cash flows from investing activities: |
|
|
|
| Purchase of fixed asset investments |
(11,477) |
(10,176) |
(17,509) |
| Disposal of current asset investments |
5,000 |
12,000 |
35,000 |
| Sale of fixed asset investments |
6,498 |
2,076 |
2,207 |
| Net cash flows from investing activities |
21 |
3,900 |
(19,698) |
| |
|
|
|
| Cash flows from financing activities: |
|
|
|
| Purchase of own shares |
(2,478) |
(1,706) |
(3,649) |
| Share issues |
8,095 |
- |
- |
| Dividends paid |
- |
(3,380) |
(6,521) |
| Net cash flows from financing activities |
5,617 |
(5,086) |
(10,170) |
| Increase/(decrease) in cash and cash equivalents |
7,085 |
(2,495) |
7,748 |
| Opening cash and cash equivalents |
13,203 |
5,455 |
5,455 |
| |
|
|
|
| Closing cash and cash equivalents |
20,288 |
2,960 |
13,203 |
Notes to the Half-Yearly Report
1. Basis of preparation
The unaudited half-yearly report which cover the six months to 31 July 2019 has been prepared in accordance with the Financial Reporting Council’s (FRC) Financial Reporting Standard 104 “Interim Financial Reporting” (March 2018) and the Statement of Recommended Practice for Investment Companies, re-issued by the Association of Investment Companies in February 2018.
2. Publication of non-statutory accounts
The unaudited half-yearly report for the six months ended 31 July 2019 does not constitute Statutory Accounts within the meaning of s.415 of the Companies Act 2006. The comparative figures for the year ended 31 January 2019 have been extracted from the audited financial statements for that year, which have been delivered to the Registrar of Companies. The independent auditor’s report on those financial statements, in accordance with chapter 3 of part 16 of the Companies Act 2006, was unqualified. This half-yearly report has not been reviewed by the Company’s auditor.
3. Earnings per share
The earnings per share is based on 252,299,145 shares, being the weighted average number of shares in issue during the period (31 January 2019: 255,593,108; 31 July 2018: 256,759,529).
There are no potentially dilutive capital instruments in issue and, therefore, no diluted earnings per share figures are relevant. The basic and diluted earnings per share are therefore identical.
4. Net asset value per share
| |
31 July 2019 |
31 July 2018 |
31 January 2019 |
| Net assets (£) |
122,093,000 |
122,252,000 |
119,024,000 |
| Shares in Issue |
264,300,126 |
255,369,857 |
252,496,695 |
| Net asset value per share (p) |
46.2 |
47.9 |
47.1 |
5. Dividends
A final dividend, for the year ended 31 January 2019, of 1.5p per share was paid on 9 August 2019 to shareholders on the register on 19 July 2019.
The interim dividend of 1.5p per share for the six months ending 31 July 2019 will be paid on 9 January 2020, to those shareholders on the register on 20 December 2019.
6. Principal Risks and Uncertainties
The principal risks and uncertainties faced by the Company are described in detail within the strategic report in the Company’s annual report for the year ended 31 January 2019.
The principal risks include loss of VCT status, investment risk, valuation risk, financial risk, internal control risk and price risk.
7. Related Party Transactions
Octopus acts as the investment manager of the Company. Under the management agreement, Octopus receives a fee of 2.0% per annum of the net assets of the Company for the investment management services.
The Company has incurred management fees of £2,198,000 during the period to 31 July 2019 (31 July 2018: £1,239,000; 31 January 2019: £2,179,000).
During the period the Company has incurred performance fees of £211,000 (31 July 2018: nil; 31 January 2019: nil) which are included in the above management fees, as is a one-off charge of £870,000 made to correct the calculation of historic performance fees.
Octopus also provides administration and company secretarial services to the Company. Octopus receives a fee of 0.3% per annum of net assets of the Company for administration services and £20,000 per annum for company secretarial services.
The Company currently holds £13.6 million of investments in Octopus managed funds, being the Octopus Portfolio Manager funds. To ensure the Company is not double charged management fees on these products, the Company receives a reduction in the management fee as a percentage of the value of these investments.
8. Other Information
A version of this statement will be made available to all shareholders. Copies are also available from the registered office of the Company at 33 Holborn, London, EC1N 2HT, and will also be available to view on the Investment Manager’s website at www.octopusinvestments.com.
