Albion Enterprise VCT PLC
Annual Report and Financial Statements
for the year ended 31 March 2024
Albion Enterprise VCT PLC
Annual Report and Financial Statements
for the year ended 31 March 2024
Shareholder information Financial adviser information
For help relating to dividend payments, shareholdings
and share certificates please contact Computershare
Investor Services PLC:
Tel: 0370 873 5860 (UK national rate call, lines are
open 8.30am – 5.30pm; Mon – Fri; calls are recorded)
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Shareholders can access holdings and valuation
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website.
Shareholders can also contact the Chairman directly
on: AAEVchair@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 Enterprise VCT PLC
(the “Company”)
United Kingdom Public Limited Company
Directors Company number Auditor
M Packe (Chairman)
C Burrows
P Latham
P Reeve
R Whitlock
05990732 Johnston Carmichael LLP
7-11 Melville Street
Edinburgh, EH3 7PE
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 Liberum Limited
Ropemaker Place, Level 12
25 Ropemaker Street
London, EC2Y 9LY
Taxation adviser Legal adviser Depositary
Philip Hare & Associates LLP
6 Snow Hill
London, EC1A 2AY
Howard Kennedy LLP
1 London Bridge
London, SE1 9BG
Ocorian Depositary (UK) Limited
Level 5, 20 Fenchurch Street
London, EC3M 3BY
The Company is a member of The Association of Investment Companies (www.theaic.co.uk).
6
35
72
Strategic
Investment objective and policy and Financial calendar 7
Financial highlights 8
Chairman’s Statement 10
Strategic Report 14
Portfolio of investments 27
Portfolio companies 30
Governance
The Board of Directors 36
The Manager 38
Environmental, Social and Governance (“ESG”) report 41
Directors’ report 45
Statement of Directors’ responsibilities 52
Statement of corporate governance 53
Directors’ remuneration report 61
Independent Auditor’s report 65
Company information and Financials
Income statement 73
Balance sheet 74
Statement of changes in equity 75
Statement of cash flows 76
Notes to the Financial Statements 77
Notice of Annual General Meeting 92
Contents
Strategic
INVESTMENT OBJECTIVE AND POLICY
invested in floating rate notes or similar instruments
with banks or other financial institutions with high credit
ratings or 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 10 per cent. 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 Venture Capital Trust qualifying
industry sectors using a mixture of securities. The
maximum amount which the Company will invest in a
single company is 15 per cent. of the Company’s assets
at cost, thus ensuring a spread of investment risk. The
value of an individual investment may increase over
time as a result of trading progress and it is possible
that it may grow in value to a point where is represents
a significantly higher proportion of total assets prior to
a realisation opportunity being available.
Gearing
The Company’s maximum exposure in relation to
gearing is restricted to 10 per cent. of its adjusted share
capital and reserves.
Investment policy
The Company will invest in a broad portfolio of
higher growth businesses across a variety of sectors
of the UK economy including higher risk technology
companies. 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 both in terms of sector and stage of
maturity of company.
VCT qualifying and non-VCT qualifying
investments
Application of the investment policy is designed to
ensure that the Company continues to qualify and is
approved as a VCT by HM Revenue and Customs (“VCT
regulations”). The maximum amount invested in any one
company is limited to relevant HMRC annual investment
limits. It is intended that normally at least 80 per cent. 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 investment.
Funds held prior to investing in VCT qualifying assets
or for liquidity purposes will be held as cash on deposit,
FINANCIAL CALENDAR
2 August 2024
Record date for first dividend
30 August 2024
Payment date for first dividend
Noon on 3 September 2024
Annual General Meeting
December 2024
Announcement of Half-yearly results for the six months ending 30 September 2024
Albion Enterprise VCT PLC (the “Company”) is a Venture Capital Trust and the investment objective of the Company
is to provide investors with a regular source of income, combined with the prospect of longer term capital growth.
7
Albion Enterprise VCT PLC
STRATEGIC
Albion Enterprise VCT PLC8
FINANCIAL HIGHLIGHTS
3.45p 2.68% 6.28p 125.77p 200.92p
Increase in total
shareholder value
(pence per share)
for the year ended
31 March 2024
†
(2023: 2.81p)
††
Shareholder return
for the year ended
31 March 2024
(2023: 2.12%)
††
Tax-free dividend
per share for the
year ended
31 March 2024
(2023: 6.49p)
Net asset value
per share on
31 March 2024
(2023: 128.60p)
Total shareholder
value per share
from launch to
31 March 2024
†
(2023: 197.47p)
††
Methodology: The total shareholder return, including original amount invested from 1 April 2014 (rebased to 100), assuming that dividends were re-
invested 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 per share at 31 March 2024 is calculated using net asset value per share at 31 December 2024 plus dividends paid per
Ordinary share since launch to 31 March 2024.
††These are considered Alternative Performance Measures, see note 3 on page 17 of the Strategic report for further explanation.
Total shareholder return relative to FTSE All-Share Index total return
(in both cases with dividends reinvested)
Apr 2014 Mar 2015 Mar 2016 Mar 2017 Mar 2018 Mar 2019 Mar 2020 Mar 2021 Mar 2022 Mar 2023 Mar 2024
Return (pence per share)
240
220
200
180
160
140
120
100
80
Total shareholder return
FTSE All-Share Index total return
STRATEGIC
9Albion Enterprise VCT PLC
The diagram above shows the one year, three year, five year and ten year total return to shareholders. This return comprises of dividends paid
and the change in net asset value over the relevant periods.
Financial highlights
Albion Enterprise VCT PLC – Performance data
1 year return 3 year return
(average 8.7% p.a.)
5 year return
(average 6.5% p.a.)
10 year return
(average 8.8% p.a.)
26.2%
32.5%
87.9%
2.7%
Movements in net asset value
31 March 2024
pence per share
31 March 2023
pence per share
Opening net asset value 128.60 132.28
Capital return 2.55 2.64
Revenue return 0.75 0.39
Total return 3.30 3.03
Dividends paid (6.28) (6.49)
Impact from share capital movements 0.15 (0.22)
Net asset value 125.77 128.60
Total shareholder value per share
†
Pence per share
Total dividends paid per share to 31 March 2024 75.15
Net asset value per share on 31 March 2024 125.77
Total shareholder value per share to 31 March 2024 200.92
A more detailed breakdown of the dividends paid per year can be found at www.albion.capital/funds/AAEV under
the ‘Dividend History’ section.
In addition to the dividends summarised above, the Board has declared a first dividend for the year ending 31
March 2025, of 3.14 pence per Ordinary share to be paid on 30 August 2024 to shareholders on the register on
2 August 2024.
† This is considered an Alternative Performance Measure.
9
Results and dividends
On 31 March 2024 the net asset value was 125.77
pence per share compared to 128.60 pence per share
on 31 March 2023. The total gain before taxation was
£3.3 million compared to £2.8 million for the previous
year.
In line with our variable dividend policy targeting
around 5% of Net Asset Value (“NAV”) per annum, the
Company paid dividends totalling 6.28 pence per share
during the year ended 31 March 2024 (2023: 6.49
pence per share). The Company will pay a first dividend
for the financial year to 31 March 2025 of 3.14 pence
per share on 30 August 2024 to shareholders on the
register on 2 August 2024, being 2.5% of this 31 March
2024 NAV.
Investment performance and progress
The results for the year showed net gains on investment
of £4.9 million, compared with net gains of £4.5 million
for the previous year. The results were largely driven
by unrealised gains across the portfolio together with
realised gains from successful exits during the year.
Our investment in Egress Software Technologies, which
achieved strong growth in the year, increased in value
by £8.0 million and was sold after the year end. The
other notable contributors to the net gain were Proveca
by £0.9 million and a realised gain in Ophelos of £0.6
million following its sale. These gains were partially
offset by unrealised losses, including a £0.8 million loss
in Threadneedle Software Holdings (T/A Solidatus) and
a £0.8 million loss in PeakData.
Albion Enterprise VCT PLC10
Despite the continuing uncertain macroeconomic and geopolitical
backdrop, and resulting market volatility, the Company recorded positive
returns. I am pleased to report a return of 3.30 pence per share for the year
ended 31 March 2024 which represents a 2.6% uplift on the opening net
asset value.
Notwithstanding the ongoing uncertainties facing the Company, the Board
remains encouraged by the progress that is being made by many of the
portfolio companies. The Board recognises that the Company has a venture
capital portfolio, which may have periods of volatility, its returns should
therefore be evaluated over the longer term.
CHAIRMAN’S
STATEMENT
Maxwell Packe
10
STRATEGIC
The Company made a number of investment realisations
in the year with proceeds totalling £6.0 million (2023:
£1.8 million). Quantexa, the largest company within
our portfolio (16% of NAV), successfully completed an
externally led $129 million Series E fundraising which
completed in April 2023, a part disposal in October 2023
delivered an 11.5 times return on its weighted average
cost. Our investment in Ophelos was sold delivering 2.1
times cost. Three investments were written off during
the year, their valuations had already been reduced
substantially in previous years. Further details on these
disposals, and other realisations, can be found in the
realisations table on page 29.
The three largest investments in the Company’s
portfolio, Quantexa, Egress Software Technologies
and Proveca are valued at £51.2 million and represent
36.4% of the Company’s NAV.
The Company has been an active investor during the
year, investing a total of £8.9 million. Of this, £3.6
million was invested into 6 new portfolio companies,
all of which are expected to require further investment
as the companies prove themselves and grow. The
following are the five largest new investments:
£1.4 million into
Treefera, an AI
enabled data
management
platform providing
granular, accurate
and trustworthy
insights on trees
and other nature-
based assets
£0.9 million into
OpenDialog AI,
which allows
organisations
to create and
deploy AI powered
chatbots and
virtual assistants
in a no-code
environment,
to allow for
conversational
experiences
with customers
and employees
across a variety of
communication
channels
£0.5 million
into Gridcog
International, a
SaaS platform
which provides
project modelling
software to plan,
track and optimise
Distributed Energy
Resources (DERs)
across multiple
sites and asset
types integrated
together
£0.5 million
into Phasecraft,
which develops
new algorithms
to make use of
early quantum
computers for
material science
problems
£0.2 million into
Kennek Solutions,
a vertical end-to-
end software for
non-bank lenders
that allows them
to manage the
full value chain of
lending in a single
platform
A further £5.3 million was invested into existing portfolio companies, the largest being: £1.0 million into Panaseer;
£1.0 million into Proveca; and £0.7 million into Gravitee TopCo (T/A Gravitee.io). A full list of the Company’s
investments and disposals, including their movements in value for the year, can be found in the Portfolio of
investments section on pages 27 to 29.
Chairman’s statement
11
Investment realisation after the year end
and updated NAV announcement
On 2 July 2024, a NAV and portfolio company
update announced that the sale of Egress Software
Technologies had completed. The sale of Egress
returned over 7 times cost.
This resulted in an unaudited 4.33 pence per share
uplift, representing a 3.4% increase on the 31 March
2024 NAV. The NAV update only reflects an adjustment
in respect of the sale of Egress, and does not reflect a
revaluation of the entire portfolio.
Board composition
I have had the privilege of serving as Chairman of the
Company since 2006, and I will retire at the Annual
General Meeting in September 2024. I am delighted
that Christopher Burrows, an existing Board member,
will succeed me as Chairman.
When Christopher Burrows becomes Chairman of the
Board and Chairman of the Nomination Committee,
Rhodri Whitlock will become the Senior Independent
Director; and Philippa Latham will become Chairman of
the Remuneration Committee.
Risks and uncertainties
The Company faces a number of significant risks
including higher interest rates, high levels of inflation,
the ongoing impact of geopolitical tensions, and
the finalisation of the Sunset Clause extension. This
complex backdrop is factored into how the Company is
managed, including its management of cash.
Our investment portfolio, while concentrated mainly
in the technology and healthcare sectors, remains
diversified in terms of both sub-sector and stage
of maturity and, importantly, we believe it to be
appropriately valued. 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 other risks and uncertainties
facing the business is shown in the Strategic report on
pages 22 to 25.
Share buy-backs
It remains the Board’s primary objective to maintain
sufficient resources for investment in existing and new
portfolio companies and for the continued payment
of dividends to shareholders. 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
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. Details of
shares bought back during the year can be found in
note 15.
Albion VCTs Prospectus Top Up Offers
Your Board, in conjunction with the boards of four other
VCTs managed by Albion Capital Group LLP, published
a Prospectus Top Up Offer of new Ordinary shares on
15 December 2023. The Offer launched to applications
on 2 January 2024 and closed on 20 March 2024. The
amount raised by the Company was £15.75 million.
The proceeds are being used to provide support to our
existing portfolio companies and to enable us to take
advantage of new investment opportunities. Details of
share allotments made during and after the financial
year end can be found in notes 15 and 19 respectively.
Chairman’s statement
12
On 2 July 2024, a NAV and
portfolio company update
announced that the sale of
Egress Software Technologies
had completed. The sale
of Egress returned over
7 times cost.
Annual General Meeting (“AGM”)
The AGM will be held virtually at noon on 3 September
2024 via the Lumi platform. Information on how to
participate in the live webcast can be found on the
Manager’s website www.albion.capital/vct-hub/agms-
events.
The Board welcome questions from shareholders at
the AGM and shareholders will be able to ask questions
using the Lumi platform during the AGM. Alternatively,
shareholders can email their questions to AAEVchair@
albion.capital prior to the AGM.
Shareholders’ views are important, and the Board
encourages shareholders to vote on the resolutions.
Further details on the format and business to be
conducted at the AGM can be found in the Directors’
report on pages 50 and 51 and in the Notice of the
Meeting on pages 92 to 95.
Audit tender process
Following a formal and rigorous audit tender process,
the Board appointed Johnston Carmichael LLP
(“Johnston Carmichael”) as the new Auditor of the
Company in October 2023. Johnston Carmichael has
conducted the audit of the Annual Report and Financial
Statements for the year ended 31 March 2024.
Shareholders will be asked to confirm the appointment
of Johnston Carmichael at the forthcoming AGM.
During the audit tender process, prospective auditors
were evaluated using guidance issued by the Financial
Reporting Council in February 2017 and the Board
completed a two-stage process which considered and
evaluated relevant expertise, audit firm quality, audit
firm resilience and value for money.
The Board would like to thank BDO for their diligent
service for over 16 years.
Further details on the tender process can be found in
the Statement of corporate governance on page 56.
Outlook and prospect
The Board is pleased with the positive return for the
year and the sale of Egress after the year end which
provided an uplift to the NAV. The portfolio remains
well diversified with companies at different stages of
maturity and targeted at sectors such as healthcare,
software and FinTech, with minimal exposure to
consumer expenditure. Therefore, the Board is
confident that the Company is well placed to grow
value for shareholders over the long term.
Maxwell Packe
Chairman
11 July 2024
1313Albion Enterprise VCT PLC
Investment policy
The Company will invest in a broad portfolio of higher
growth businesses with a stronger focus on technology
companies across a variety of sectors of the UK
economy. 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 both in terms of sector and stage of
maturity of company.
The full investment policy can be found on page 7.
Current portfolio sector allocation
The following pie charts are a useful way of showing
the split of the portfolio valuation on 31 March 2024
by: sector; stage of maturity measured by revenues;
and their size measured by number of employees.
Details of the principal investments made by the
Company are shown in the Portfolio of investments on
pages 27 and 28.
STRATEGIC REPORT
Investment portfolio by sector Portfolio analysis by stage of investment
Portfolio analysis by number of employees
Cash and other net assets 25% (26%)
Healthcare (including digital healthcare) 18% (19%)
FinTech 22% (26%)
Software & technology 28% (20%)
Renewable energy 4% (5%)
Other (including Education) 3% (4%)
Comparatives for 31 March 2023 are shown in brackets.
*Renewable energy companies have no employees
Early stage (revenue less than £1 million) 7% (7%)
Growth (revenue between £1 million and £5 million) 11% (14%)
Scale up (revenue over £5 million) 82% (79%)
Under 20 4% (3%)
21 - 50 12% (14%)
51 - 100 15% (18%)
101+ 64% (59%)
Renewable energy* 5% (6%)
Albion Enterprise VCT PLC 14
STRATEGIC
Direction of portfolio
Due to the share allotments under the 2023/24
Prospectus Top Up Offer, the cash and net assets
component currently sits at 25%, which the Company
will use to support those portfolio companies
that require it, as well as to capitalise on any new
investment opportunities that arise. Whilst the sale
of Egress after the year end will result in a reduction
of weighting in the software and other technology
investments, our investment focus will continue to
be on this sector, along with FinTech and healthcare
(including digital healthcare). These three areas will
continue to make up the majority of the portfolio of
investments over the coming years.
Results and dividends
The Company paid dividends totaling 6.28 pence per
share during the year ended 31 March 2024 (2023:
6.49 pence per share). The Board has declared a first
dividend for the year ending 31 March 2025, of 3.14
pence per Ordinary share to be paid on 30 August 2024
to shareholders on the register on 2 August 2024.
As shown in the Company’s Income statement on
page 73, the total return for the year was 3.30 pence
per share (2023: 3.03 pence per share). Investment
income increased to £1,697,000 (2023: £1,206,000),
This is due to increased bank interest and income from
fixed term funds from higher interest rates in the year.
The revenue return to equity holders has subsequently
increased to £758,000 (2023: £352,000).
The capital return on investments for the year was
£4,883,000 (2023: £4,535,000). The net gain was due
to an increase in the unrealised value of investments.
Key valuation movements during the year are outlined
in the investment performance and progress section
of the Chairman’s statement on pages 10 and 11.
The total capital gain for the year was 2.55 pence per
share (2023: 2.64 pence per share).
There was a net cash inflow for the Company of
£3,454,000 for the year (2023: £3,308,000), which has
arisen from the disposal of fixed asset investments, the
increase in bank interest and income from fixed terms
funds and the issue of Ordinary shares under the Albion
VCTs Top Up Offers, reduced by the investments made
in new and existing portfolio companies, dividends
paid, operating expenses and the buy-back of shares.
Review of business and future changes
A detailed review of the Company’s business during
the year is contained in the Chairman’s statement on
pages 10 to 13. The results for the year to 31 March
2024 show total shareholder value of 200.92 pence per
share since launch (2023: 197.47 pence per share).
There is a continuing focus on growing the FinTech,
healthcare (including digital healthcare) and other
software and technology sectors. The majority of these
investment returns are delivered through equity and
capital gains, and will be the key driver of success for
the Company. Investment income, which is received
primarily from our renewable energy investments, is
expected to remain steady over the coming years.
Results and dividends
£’000
Net capital return for the year ended 31 March 2024 2,576
Net revenue return for the year ended 31 March 2024 758
Total return for the year ended 31 March 2024 3,334
Dividend of 3.22 pence per share paid on 31 August 2023 (3,247)
Dividend of 3.06 pence per share paid on 29 February 2024 (3,062)
Unclaimed dividends 3
Transferred from reserves (2,972)
Net assets on 31 March 2024 140,648
Net asset value on 31 March 2024 125.77 pence per share
Strategic report
15Albion Enterprise VCT PLC
Details of significant events which have occurred since
the end of the financial year are listed in note 19.
Details of transactions with the Manager are shown
in note 5.
Future prospects
The Company’s financial results for the year
demonstrates that the portfolio remains well
balanced across sectors and risk classes, and is largely
weathering the impacts of the ongoing global issues
caused as a result of high levels of interest rates and
inflation, due in part to the geopolitical tensions,
however the full effects of these issues will continue
to be felt in years to come. Although there remains
much uncertainty, the Board considers that the current
portfolio has the potential to deliver long term growth,
whilst maintaining a predictable stream of dividend
payments to shareholders. Further details of the
Company’s outlook can be found in the Chairman’s
statement on page 13.
Key Performance Indicators (“KPIs”) and
Alternative Performance Measures (“APMs”)
The Directors believe that the following KPIs and APMs,
which are typical for Venture Capital Trusts, 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.
1. Total shareholder return relative to FTSE All
Share Index total return
The graph on page 8 shows the Company’s total
shareholder return relative to the FTSE All-Share Index
total return, with dividends reinvested. The FTSE All-
Share Index is considered a reasonable benchmark
as the Company is classed as a generalist UK VCT
investor, and this index includes over 600 companies
listed in the UK, including small-cap, covering a range
of sectors. Details on the performance of the net asset
value and return per share for the year are shown in the
Chairman’s statement.
Net asset value per share and cumulative dividends*
Strategic report
Methodology: NAV per share is calculated as net assets divided by the number of Ordinary shares in issue (excluding Treasury Shares).
Net asset value Cumulative dividend
Pence per share
200
180
160
140
120
100
80
60
40
20
0
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
Albion Enterprise VCT PLC 16
2. Net asset value per share and cumulative
dividends*
The chart on page 16 illustrates the movement in net
asset value per share plus cumulative dividends paid
since launch to 31 March 2024.
3. Shareholder value (APM) and Shareholder
return
†
(APM)
Total shareholder value since inception (being the NAV
plus dividends paid) increased by 3.45 pence per share
(2.7% on opening NAV) to 200.92 pence per share
for the year ended 31 March 2024 as a result of the
positive total return of 3.30 pence per share.
The table below shows the total shareholder value has
increased in 9 out of the last 10 years, with an average
annual return of 8.0% per annum.
4. Dividend distributions
Dividends paid in respect of the year ended 31 March
2024 were 6.28 pence per share (2023: 6.49 pence per
share). Cumulative dividends paid since inception total
75.15 pence per share.
5. Ongoing charges (APM)
The ongoing charges ratio for the year ended 31 March
2024 was 2.50% (2023: 2.50%). The ongoing charges
ratio has been calculated using The Association
of Investment Companies’ (AIC) recommended
methodology. This figure shows shareholders the
total recurring annual running expenses (including
investment management fees charged to capital
reserve) as a percentage of the average net assets
attributable to shareholders. The ongoing charges cap
is 2.50%, which has resulted in a saving of £25,000 to
shareholders during the year (2023: £24,000).
Movement in shareholder value in the year
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
4.5% 5.4% 10.8% 12.4% 13.1% (4.4)% 12.7% 20.7% 2.1% 2.7%
†Methodology: Calculated by the movement in total shareholder value per share for the year divided by the opening net asset value.
Dividends paid
Strategic report
Dividends paid in the year Cumulative dividend
Pence per share
80
70
60
50
40
30
20
10
0
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
17Albion Enterprise VCT PLC
6. VCT compliance*
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
Venture Capital Trust 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 page 46.
The relevant tests to measure compliance have
been carried out and independently reviewed for the
year ended 31 March 2024. These showed that the
Company has complied with all tests and continues to
do so.
Gearing
As defined by the Articles of Association, the
Company’s maximum exposure in relation to gearing
is restricted to 10% of its 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 the Manager, Albion
Capital Group LLP, which is authorised and regulated
by the Financial Conduct Authority. The Manager also
provides company secretarial and other accounting and
administrative support to the Company.
Management agreement
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. The Management
agreement is subject to earlier termination in the
event of certain breaches or on the insolvency of either
party. The Manager is paid an annual management
fee equal to 2% of the net asset value of the Company
paid quarterly in arrears, and a separate annual
administration fee of 0.2% of the net asset value.
Total annual ongoing expenses, including the
management fee but excluding any performance
incentive fee, are limited to 2.50% of the net asset
value.
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
portfolio company.
Further details on the management fee can be found in
note 5.
Management performance incentive fee
In order to align the interests of the Manager and
the shareholders with regards to generating positive
returns, the Company has a Management performance
incentive arrangement with the Manager. Under the
incentive arrangement, the Company will pay an
incentive fee to the Manager of an amount equal to
20% of such excess return that is calculated for each
financial year.
The performance fee hurdle requires that the growth
of the aggregate of the net asset value per share and
dividends paid by the Company compared with the
previous accounting date exceeds the higher of the
average base rate of the Royal Bank of Scotland PLC
plus 2% or RPI plus 2%. The hurdle is calculated every
year, based on the starting rate of 100 pence per share
in 2007.
For the year ended 31 March 2024, the total return of
the Company since launch (the performance incentive
fee start date) amounted to 200.92 pence per share,
compared to the higher hurdle of 217.19 pence per
share. As a result, no performance incentive fee is
payable to the Manager (2023: £nil).
*VCT compliance is not a numerical measure of performance and thus cannot be defined as an APM.
Albion Enterprise VCT PLC 18
Strategic report
Evaluation of the Manager
The Board has evaluated the performance of the
Manager based on:
• the returns generated by the Company;
• the continuing achievement of the HMRC tests
for VCT status;
• the long term prospects of the current portfolio
of investments;
• the management of treasury, including use of
buy-backs and participation in fundraising; and
• benchmarking the performance of the Manager
to other VCT managers, and the other VCTs
managed by Albion.
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 the Manager as the Company’s
AIFM in 2014 as required by the AIFMD. The Manager
is a full-scope Alternative Investment Fund Manager
under the AIFMD. Ocorian Depositary (UK) Limited is
the appointed Depositary and oversees the custody
and cash arrangements and provides other AIFMD
duties with respect to the Company.
Consumer duty
The FCA’s Consumer Duty came into effect from 31 July
2023. These rules set a higher standard of consumer
protection in financial services. The Manager as AIFM
is within scope of the FCA’s Consumer Duty, but the
Company itself is not.
The Manager is, for the purposes of Consumer Duty, a
“manufacturer” of the Company’s shares as it is a firm
that has some influence over design and distribution
of the Company’s share product. The Manager’s latest
assessment of value for the Company’s shares was
completed in December 2023. The value assessment
concluded that the Company provides fair value for
shareholders. Where the Manager’s product review
concludes that changes may help deliver better
outcomes for consumers, it will recommend these
changes to the Board.
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 to 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.
Strategic report
19
The table below sets out the key stakeholders and 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 Decision outcomes 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 in accordance
with Listing Rules and Disclosure
Guidance and Transparency Rules
(“DTRs”) covering such things as the
publication of a Prospectus.
• Albion Capital website, social media
pages, as well as publishing Albion
news shareholder magazine.
• Shareholders’ views are important and the Board encourages Shareholders to
exercise their right to vote on the resolutions at the AGM. The Company’s AGM
is typically used as an opportunity to communicate with investors, including
through a presentation made by the Manager. Undertaking this virtually enabled
engagement with a wider audience of shareholders from across the country,
and gave shareholders the opportunity to ask questions and vote during the
virtual AGM last year. The virtual medium helps facilitate greater shareholder
participation and to help those who are unable to attend the AGM in person, as
well as provide a recording of the event for Shareholders to watch on demand.
• Shareholders are also encouraged to attend the in person annual Shareholder
Seminar. Last year’s event took place on 15 November 2023. The seminar included
OutThink and Proveca 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 attend the seminar. The Board considers this an important interactive
event and invites shareholders to attend this year’s event scheduled for 20
November 2024 at No. 11 Cavendish Square, London. Further information will be
available nearer the time.
• The Board recognises the importance to Shareholders of maintaining a share
buy-back policy, in order to provide market liquidity, and considered this when
establishing the current policy. The Board closely monitors the discount to the net
asset value to ensure this is 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.
• During the year, the Board made the decision to participate in the Albion
Prospectus Top Up Offer, to raise funds for deployment into new and existing
portfolio companies. The Prospectus was published on 15 December 2023 and the
Offer launched to applications on 2 January 2024. 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 publish the Prospectus. On allotment, an issue price formula based on the
prevailing net asset value was used to ensure there was no dilution to existing
Shareholders.
• Cash management and liquidity of the Company are key quarterly discussions
amongst the Board, with focus on deployment of cash for future investments,
dividends and share buy-backs.
• Shareholders can contact the Chairman using the email AAEVchair@albion.capital
Albion Enterprise VCT PLC 20
Strategic report
Engagement with Stakeholder Decision outcomes 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 Environmental, Social and
Governance (“ESG”) 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, e.g. 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, which includes reviewing comparator engagement terms and portfolio
performance. Further details on the evaluation of the Manager, and the decision
to continue the appointment of the Manager for the forthcoming year, can be
found in this report.
• Details of the Manager’s responsibilities can be found in the Statement of
corporate governance on pages 53 to 60.
Suppliers
The key suppliers are:
• Auditor;
• Corporate broker;
• Depositary;
• Legal adviser;
• Registrar; and
• VCT taxation adviser.
• The Manager, on behalf of the Company, is in regular contact with the suppliers
and 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.
• As outlined in the Chairman’s statement, following a formal and rigorous audit
tender process, the Company was pleased to announce the appointment of
Johnston Carmichael LLP as the Company’s Auditor.
• The Manager reviews the performance of the providers annually and is satisfied
with their performance.
Portfolio companies
The portfolio companies are
considered key stakeholders, not least
because they are principal drivers
of value for the Company. Also, as
discussed in the ESG report on pages
41 to 44, the portfolio companies’
impact on their stakeholders 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 page 14.
• In most cases, an Albion executive has either a place on the board of a portfolio
company or is an observer, in order to help with both business operation decisions,
as well as good ESG practice.
• The Manager provides access to deep expertise on growth strategy alignment,
leadership team hiring, organisational scaling and founder leader development.
• The Manager facilitates good dialogue with portfolio companies, and often puts
on events in order to help portfolio companies benefit from the Albion network.
Community and environment
The Company, with no employees, has
no effect itself on the community and
environment. However, as discussed
above, the portfolio companies’ ESG
impact is extremely important to the
Board.
• The Board receives reports on ESG factors within its portfolio from the Manager
as it is a signatory of the UN Principles for Responsible Investment (“UN PRI”).
Further details of this are set out in the ESG report. ESG, without its specific
definition, has always been at the heart of the responsible investing that the
Company engages in and in how the Company conducts itself with all of its
stakeholders.
21
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 effectiveness of
these policies. As an externally managed investment
company with no employees, the Company has no
formal policies in these matters, however, it is at the
core of its responsible investment strategy as detailed
above.
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
and these are set out in the Directors’ report on pages
47 and 48.
General Data Protection Regulation
The General Data Protection Regulation (“GDPR”) 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.
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 impact on the Company. In the period the
most noticeable risks have been high interest rates
and inflation, caused in part by current geopolitical
tensions, and volatility in world markets. The full impact
of these risks are likely to continue to be uncertain for
some time.
The Board has carried out a robust assessment of
the Company’s principal and emerging risks and
uncertainties. It 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:
Albion Enterprise VCT PLC 22
Possible consequence Risk assessment
during the year
Risk management
Principal Risks
Risk: Investment, performance, technology 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
purposes, are more volatile in
terms of their performance and
valuations, than larger, long-
established businesses.
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.
No change during
the year, but
remains high due
to the economic
and geopolitical
issues as referred to
in the Chairman’s
statement.
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 2023/24 Top Up was due to
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 or knowable
material facts at the date of valuation.
Risk: Regulatory and compliance risk
The Company is listed on The
London Stock Exchange and
is required to comply with the
rules of the Financial Conduct
Authority, as well as with the
Companies Act, Accounting
Standards and other legislation.
Failure to comply with these
regulations could result in a
delisting of the Company’s
shares, or other penalties under
the Companies Act or from
financial reporting oversight
bodies.
No change in the
year.
As a Venture Capital Trust whose shares are traded on the London
Stock Exchange’s premium list, the Company is impacted by actual
and prospective changes to legislation and HMRC guidance governing
VCTs. Legislation to extend the VCT scheme until 2035 has been
passed. However, the full implementation of this updated Sunset
Clause is still subject to European Union sign off which is expected
in the coming months. Board members and the Manager have
experience of operating at senior levels within or advising quoted
companies. Furthermore, the Manager is actively involved with key
industry bodies who meet periodically with HMRC and relevant
government representatives to ensure that they have a good
understanding of relevant sector developments. The Board and the
Manager also receive regular updates on new regulation from its
auditor, legal advisers and other professional bodies. The Manager’s
services include ensuring that the Company complies with the relevant
rules. The Manager is regulated by the Financial Conduct Authority
and has a dedicated compliance function to ensure it complies with
rules applicable to its regulated fund management services. Any issues
arising from compliance or regulation are reported to the Manager’s
Executive Committee and, where they relate to the Company, are
reported to the Board in quarterly Board meetings.
23Albion Enterprise VCT PLC
Strategic report
Possible consequence Risk assessment
during the year
Risk management
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 further
formal reassurance, 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, to 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.
Risk: Operational and internal control risk
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 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.
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.
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 strong
systems and controls in place including those in relation to business
continuity and cyber security, as mentioned below.
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: Cyber and data security risk
A cyber attack on one of the
Company’s third party suppliers
could result in the security
of, potentially sensitive, data
being compromised, leading
to financial loss, disruption or
damage to the reputation of
the Company.
No change in the
year.
The Manager outsources some of its IT services, including hardware
and software procurement, server management, backup provision and
day-to-day support through an outsourcing arrangement with an IT
consultant. In house IT support is also provided.
The Manager takes cyber risks seriously and the need to guard against
these are in the Service level agreement with our key outsourced
service provider. During the year, further investment was made in the
Manager’s IT infrastructure and awareness training.
In addition, the Manager also has a business continuity plan which
includes off-site storage of records and remote access provisions. This
is revised and tested annually and is also subject to Compliance, Group
Risk and Internal Audit reporting. Penetration tests are also carried out
to ensure that IT systems are not susceptible to cyber-attacks.
The Manager’s Internal Auditor performs reviews on IT general
controls and data confidentiality and makes recommendations where
necessary. The 2023 internal audit focused specifically on IT systems.
Albion Enterprise VCT PLC 24
Strategic report
Possible consequence Risk assessment
during the year
Risk management
Risk: Economic, political and social risk
Changes in economic
conditions, including, for
example, 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
continued high
levels of inflation
and interest rates
and new areas
of geopolitical
tensions.
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 are continuously assessing 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 these uncertain
times. The portfolio is structured as an all-weather portfolio with
c.59 companies which are diversified as discussed above. Exposure is
relatively small to at-risk sectors that include leisure, hospitality, retail
and travel.
Risk: Liquidity risk
The Company may not have
sufficient cash available to meet
its financial obligations. The
Company’s portfolio is primarily
in smaller unquoted companies,
which are inherently illiquid
as there is no readily available
market, and thus it may be
difficult to realise their fair value
at short notice.
No change in the
year.
To reduce this risk, the Board reviews the Company’s three year
cash flow forecasts on a quarterly basis. These include potential
investment realisations (which are closely monitored by the
Manager), Top Up Offers, dividend payments and operational
expenditure. This ensures that there are sufficient cash resources
available for the Company’s liabilities as they fall due.
Emerging Risks
Risk: Environmental, social and governance (“ESG”) risk
An insufficient ESG policy could
lead to an increased negative
impact on the environment,
including the Company’s carbon
footprint. Non-compliance
with reporting requirements
could lead to a fall in demand
from investors, reputational
damage and penalties. Climate
risks could also negatively
impact on the value of portfolio
investments.
No change in the
year.
The Manager is a signatory of the UN PRI and the Board is kept
appraised of the evolving ESG policies at quarterly Board meetings.
Full details of the specific procedures and risk mitigation can be
found in the ESG report on pages 41 to 44. These procedures ensure
that this increased risk continues to be mitigated where possible.
Whilst the Company itself has limited impact on climate change,
due to no employees nor greenhouse gas emissions, the Board works
closely with the Manager to ensure the Manager itself is working
towards reducing its impact on the environment, and that the
Manager takes account of ESG factors, including the impact on the
environment, when making new investment decisions. With specific
respect to the Company, a key operation is increasing the use of
electronic communications with Shareholders.
25Albion Enterprise VCT PLC
Strategic report
Viability statement
In accordance with the FRC UK Corporate Governance
Code published in 2018 and principle 36 of the AIC
Code of Corporate Governance, the Directors have
assessed the prospects of the Company over three
years to 31 March 2027. The Directors believe that
three years is a reasonable period in which they can
assess the ability of the Company to continue to
operate 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.
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
carefully assessed, and were satisfied with, the risk
management processes in place to avoid or reduce
the impact of these risks. The Board has carried out
robust stress testing of cashflows which included;
factoring in high levels of inflation when budgeting
for future expenses, only including proceeds from
investment disposals where there is a high probability
of completion, whilst also assessing the requirement for
any future support of portfolio companies.
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.
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 March 2027. The Board is
mindful of the ongoing 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.
Companies Act 2006
This Strategic report of the Company for the year ended
31 March 2024 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
Maxwell Packe
Chairman
11 July 2024
Albion Enterprise VCT PLC 26
Strategic report
On 31 March 2024 On 31 March 2023
Fixed asset investments
% voting rights
% voting rights
held by all Albion*
managed VCTs
Cost
£’000
Cumulative movement
in value £’000
Value
£’000
Cost
£’000
Cumulative
movement in value
£’000
Value
£’000
Change in value for
the year**
£’000
Quantexa 1.9 8.5 2,069 20,095 22,164 2,108 22,211 24,319 -
Egress Software Technologies 9.8 24.4 3,365 17,430 20,795 3,365 9,392 12,757 8,038
Proveca 8.6 44.5 2,487 5,707 8,194 1,850 4,874 6,724 833
Oviva 2.8 12.2 2,601 1,577 4,178 2,601 1,341 3,942 236
Radnor House School (TopCo) 9.4 48.3 1,729 1,971 3,700 1,729 2,127 3,856 (156)
Gravitee Topco (T/A Gravitee.io) 3.8 20.2 2,168 1,185 3,353 1,431 366 1,797 819
Healios 7.6 33.5 2,955 38 2,993 2,500 522 3,022 (484)
The Evewell Group 6.1 33.0 1,477 1,226 2,703 1,477 1,777 3,254 (551)
Panaseer 3.0 14.9 1,836 533 2,369 816 387 1,203 146
Runa Network 2.3 14.9 1,871 414 2,285 1,396 327 1,723 87
Regenerco Renewable Energy 12.5 50.0 1,261 581 1,842 1,261 638 1,899 (57)
Convertr Media 6.2 26.6 992 802 1,794 992 1,081 2,073 (279)
The Street by Street Solar Programme 8.6 50.0 891 643 1,534 891 703 1,594 (60)
Cantab Research (T/A Speechmatics) 1.6 14.4 1,359 149 1,508 1,359 239 1,598 (90)
Elliptic Enterprises 0.9 5.9 1,373 6 1,379 1,219 - 1,219 6
Peppy Health 1.5 8.7 1,372 - 1,372 1,372 - 1,372 -
Treefera 2.2 11.3 1,371 - 1,371 - - - -
Threadneedle Software Holdings (T/A
Solidatus)
2.4 12.5 1,360 - 1,360 1,360 810 2,170 (810)
Aridhia Informatics 6.3 21.0 1,244 83 1,327 1,244 71 1,315 12
Toqio FinTech Holdings 1.8 10.4 1,279 - 1,279 1,279 - 1,279 -
NuvoAir Holdings 2.0 11.2 1,271 7 1,278 826 371 1,197 (364)
Accelex Technology 2.7 15.4 782 371 1,153 517 - 517 371
Alto Prodotto Wind 11.1 50.0 654 425 1,079 720 487 1,207 (28)
Greenenerco 28.6 50.0 572 441 1,013 640 516 1,156 (45)
GX Molecular (T/A CS Genetics) 2.7 20.2 1,000 1 1,001 786 - 786 1
OpenDialog AI 3.2 16.7 949 - 949 - - - -
InCrowd Sports 3.8 17.2 698 247 945 588 247 835 -
TransFICC 2.1 14.7 938 - 938 938 223 1,161 (223)
Beddlestead 8.1 49.0 966 (114) 852 966 (119) 847 5
Tem Energy 1.7 9.5 527 253 780 213 - 213 253
Locum’s Nest 5.1 25.6 602 171 773 602 (51) 551 222
Seldon Technologies 3.1 22.7 1,046 (276) 770 1,046 133 1,179 (409)
OutThink 2.6 13.9 644 - 644 644 - 644 -
uMedeor (T/A uMed) 3.2 21.4 603 (22) 581 201 70 271 (88)
Diffblue 2.3 12.9 541 - 541 541 - 541 -
Gridcog International 2.6 15.9 497 - 497 - - - -
Phasecraft 0.8 4.2 455 - 455 - - - -
PORTFOLIO OF INVESTMENTS
27Albion Enterprise VCT PLC
STRATEGIC
On 31 March 2024 On 31 March 2023
Fixed asset investments
% voting rights
% voting rights
held by all Albion*
managed VCTs
Cost
£’000
Cumulative movement
in value £’000
Value
£’000
Cost
£’000
Cumulative
movement in value
£’000
Value
£’000
Change in value for
the year**
£’000
PetsApp 2.4 13.6 450 - 450 450 - 450 -
Koru Kids 2.2 8.3 694 (320) 374 674 (107) 567 (213)
5Mins AI 2.0 11.1 360 - 360 360 - 360 -
Perchpeek 1.9 13.6 591 (236) 355 591 - 591 (236)
Cisiv 6.1 21.1 799 (482) 317 799 (33) 766 (449)
Imandra 1.3 8.1 173 87 260 173 87 260 -
Kohort Software (previously Ramp
Software)
1.7 10.2 257 - 257 257 - 257 -
Mirada Medical 5.0 15.0 1,487 (1,279) 208 1,487 (1,279) 208 -
AVESI 5.5 50.0 179 27 206 179 41 220 (14)
Kennek Solutions 0.6 3.3 186 - 186 - - - -
Neurofenix 2.7 14.8 552 (380) 172 552 (165) 387 (215)
Mondra Global 0.1 0.8 166 2 168 - - - 2
PeakData 1.9 11.2 862 (751) 111 862 56 918 (808)
Arecor Therapeutics PLC*** 0.3 1.3 93 10 103 210 220 430 (87)
Infact Systems (T/A Infact) 1.7 10.0 88 - 88 88 - 88 -
MHS 1 1.2 48.8 83 (2) 81 83 4 87 (6)
Symetrica 0.2 4.8 63 (4) 59 63 (3) 60 (1)
Black Swan Data 3.5 20.2 2,237 (2,228) 9 2,237 (1,964) 273 (264)
Regulatory Genome Development 0.8 5.4 126 (126) - 114 - 114 (126)
Total fixed asset investments 57,251 48,262 105,513
48,657 45,600 94,257
4,968
* Albion Capital Group LLP
** As adjusted for additions and disposals during the year; including realised gains/(losses).
*** Quoted investment
The comparative cost and valuations for 31 March 2023 do not agree to the Annual Report and Financial
Statements for the year ended 31 March 2023 as the above table does not include brought forward investments
that were fully disposed of in the year.
Portfolio of investments
Albion Enterprise VCT PLC 28
Fixed asset investment realisations
Cost
£’000
Opening
carrying
value*
£’000
Disposal
proceeds
£’000
Total
realised
(loss)/gain
on cost
£’000
Gain/(loss)
on opening
value
£’000
Disposals:
Quantexa 39 2,155 2,154 2,115 (1)
Ophelos 526 526 1,081 555 555
Arecor 118 241 178 60 (63)
Brytlyt 391 391 7 (384) (384)
Umotif 1,109 66 1 (1,108) (65)
Dysis Medical 2,742 447 - (2,742) (447)
Limitless Technology 471 113 - (471) (113)
Loan stock repayments and other:
Proveca 338 339 358 20 19
Greenenerco 68 97 97 29 -
Alto Prodotto Wind 66 99 99 33 -
UMedeor 67 70 71 4 1
Escrow adjustments and other** - - 60 60 60
Total fixed asset realisations 5,935 4,544 4,106 (1,829) (438)
*As adjusted for additions during the year
** These comprise fair value movements on deferred consideration on previously disposed investments and expenses which are incidental to the
purchase or disposal of an investment.
£’000
Total change in value of investments for the year 4,968
Movement in loan stock accrued interest 85
Unrealised gains sub-total 5,053
Realised losses in the current year (438)
Unwinding of discount on deferred consideration 268
Total gains on investments as per Income statement 4,883
Portfolio of investments
29Albion Enterprise VCT PLC
Healthcare (including digital healthcare)
Renewable energy
Software & other technology
FinTech
Other (including education)
Albion Enterprise VCT PLC 30
PORTFOLIO COMPANIES
STRATEGIC
1
Audited results for the year ended:
31 March
2023
31 March
2022
£’000 £’000
Turnover 57,858 37,177
LBITDA (54,418) (26,228)
Loss before tax (54,211) (26,874)
Net assets 35,725 85,147
Investment information £’000
Income recognised in the the year -
Total cost 2,069
Valuation 22,164
Voting rights 1.9%
Voting rights for all Albion managed VCTs 8.5%
Basis of valuation Cost and price of recent
investment (calibrated and
reviewed for impairment)
www.quantexa.com
Quantexa has developed an analytics platform which offers entity resolution, network
analytics and automated decisioning at massive scale in real time. This capability is used
to fight financial crime and reduce fraud. Quantexa now counts many of the world’s largest
banks, insurers and governments among its clients.
2
Egress Software Technologies has developed a secure communication
platform that uses encryption and machine learning to secure content shared via e-mail
and other applications. Egress serves organisations and small enterprise customers in the
public sector, legal, healthcare, financial services and defense sectors. Egress was sold after
the year end.
Audited results for the year ended:
31 December
2022
31 December
2021
£’000 £’000
Turnover 27,127 21,890
LBITDA (9,276) (8,106)
Loss before tax (10,177) (8,612)
Net liabilities (17,392) (8,537)
Investment information £’000
Income recognised in the year -
Total cost 3,365
Valuation 20,795
Voting rights 9.8%
Voting rights for all Albion managed VCTs 24.4%
Basis of valuation Discounted offer price
www.egress.com
31Albion Enterprise VCT PLC
4
3
5
www.proveca.com
www.oviva.com
www.radnorhouse.org
Proveca is a specialty pharmaceutical company focused on children’s medicines.
The company is addressing a significant need in developing drugs that are specifically
formulated for children, taking advantage of a supportive regulatory regime and market
protection throughout Europe. Its first product for chronic drooling was launched in 2017.
It has a pipeline of drugs focused on neurology, immunology and cardiovascular that it
expects to reach the market over the next three years.
Radnor House School (TopCo) operates a co-educational independent
school near Sevenoaks, Kent. The school is growing strongly with over 500 children on the
roll and further capacity to expand. Significant further investment has been made into
the school’s facilities to enable it to deliver a personalised education experience to each
student. The curriculum and co-curricular activities are designed to give each child a wide
range of academic and other skills in a supportive and nurturing environment.
Oviva is the category leader in Europe for digital, reimbursed dietetic care. The company
sells digital and technology-led services solutions for conditions such as diabetes and
obesity. It consistently demonstrates best-in-class outcomes helping its clients save costs
and improve patient well-being. It is active in the UK, Germany, France and Switzerland.
Filleted audited results for the year ended:
31 July 2023 31 July 2022
£’000 £’000
Net liabilities (3,019) (2,545)
Investment information £’000
Income recognised in the year -
Total cost 2,487
Valuation 8,194
Voting rights 8.6%
Voting rights for all Albion managed VCTs 44.5%
Basis of valuation Revenue multiple
Audited results for the year ended:
31 December
2022
31 December
2021
£’000 £’000
Turnover 14,123 7,531
LBITDA (14,124) (9,468)
Net assets 43,084 61,700
Investment information £’000
Income recognised in the year -
Total cost 2,601
Valuation 4,178
Voting rights 2.8%
Voting rights for all Albion managed VCTs 12.2%
Basis of valuation Cost and price of recent
investment (calibrated and
reviewed for impairment)
Audited results for the year ended:
31 August
2023
31 August
2022
£’000 £’000
Turnover 10,639 9,338
EBITDA 1,835 1,368
Profit/(loss) before tax 276 (123)
Net assets 18,204 12,238
Investment information £’000
Income recognised in the year 276
Total cost 1,729
Valuation 3,700
Voting rights 9.4%
Voting rights for all Albion managed VCTs 48.3%
Basis of valuation Earnings multiple – supported by
third party valuation
Albion Enterprise VCT PLC 32
Portfolio companies
6
7
8
www.healios.org.uk
Gravitee.io operates an API management platform that enables enterprises to
manage their APIs through their lifecycle (from design to publishing to controlling access
and security).
The Evewell owns and operates private women’s health centres of excellence with
one clinic open on Harley Street and another in Hammersmith, both focusing on fertility
and IVF treatment but uniquely also covering all aspects of a woman’s gynaecological
health.
Healios is an online platform delivering family centric psychological care primarily
to children and adolescents. The Company provides assessment, treatment and early
intervention for a variety of mental health conditions.
Filleted audited results for the year ended:
31 December
2022
31 December
2021
£’000 £’000
Net assets 6,522 4,234
Investment information £’000
Income recognised in the year -
Total cost 2,168
Valuation 3,353
Voting rights 3.8%
Voting rights for all Albion managed VCTs 20.2%
Basis of valuation Revenue multiple
Audited results for the year ended:
31 December
2022
31 December
2021
£’000 £’000
Turnover 18,754 10,843
LBITDA (8,438) (5,498)
Loss before tax (7,561) (5,783)
Net (liabilities)/
assets
(3,636) 50
Investment information £’000
Income recognised in the year -
Total cost 2,955
Valuation 2,993
Voting rights 7.6%
Voting rights for all Albion managed VCTs 33.5%
Basis of valuation Cost and price of recent
investment (calibrated and
reviewed for impairment)
Filleted audited results for the year ended:
31 December
2022
31 December
2021
£’000 £’000
Net liabilities (1,478) (978)
Investment information £’000
Income recognised in the year 133
Total cost 1,477
Valuation 2,703
Voting rights 6.1%
Voting rights for all Albion managed VCTs 33.0%
Basis of valuation Earnings multiple
www.gravitee.io
www.evewell.com
33Albion Enterprise VCT PLC
Portfolio companies
9
10
Runa Network provides a cloud platform and an API that enables corporates to
purchase digital gift cards and issue digital payouts to employees and customers. This
can be done for a variety of use cases such as HR (employee benefits/rewards), marketing
(customer acquisition/activation), loyalty and disbursements. It has built unique technology
and direct integrations with over a thousand brands and retailers on the supply side.
Panaseer has developed a software platform which integrates and captures data
provided by an enterprise’s cyber security systems. The platform has a visualisation layer
which gives an easy interface for CIOs and CSOs to interrogate its security data on an
enterprise-wide basis, offering RoI analysis and threat intelligence.
Audited results for the year ended:
30 June
2023
30 June
2022
£’000 £’000
Turnover 10,094 5,277
LBITDA (7,606) (11,545)
Loss before tax (8,542) (11,672)
Net (liabilities)/assets (4,744) 3,598
Investment information £’000
Income recognised in the year -
Total cost 1,836
Valuation 2,369
Voting rights 3.0%
Voting rights for all Albion managed VCTs 14.9%
Basis of valuation Cost and price of recent
investment (calibrated and
reviewed for impairment)
Audited results for the year ended:
31 December
2022
31 December
2021
£’000 £’000
Turnover 34,069 32,642
LBITDA (8,841) (5,032)
Loss before tax (9,054) (5,245)
Net assets 9,967 2,793
Investment information £’000
Income recognised in the year -
Total cost 1,871
Valuation 2,285
Voting rights 2.3%
Voting rights for all Albion managed VCTs 14.9%
Basis of valuation Cost and price of recent
investment (calibrated and
reviewed for impairment)
www.panaseer.com
www.runa.io
Albion Enterprise VCT PLC 34
Portfolio companies
Governance
The following are the Directors of the Company, all of whom operate in a non-executive capacity:
THE BOARD OF DIRECTORS
Maxwell Packe (Chairman), (appointed 28 November 2006) has been chairman of
a number of quoted and private equity-backed companies with successful trade sales
including Kelvin Hughes Group, Paragon Book Services Limited, Crestacare PLC, and
Corgi Classics Limited. Previously he was founder and chief executive of Household
Mortgage Corporation PLC until its sale to Abbey National Plc.
Christopher Burrows, MA, (appointed 27 June 2018) gained 35 years experience in
international leadership consulting, executive search and assessment. Having graduated
in Anthropology from the University of Cambridge, he started his consulting career
with Whitehead Mann and subsequently became the youngest partner at Goddard Kay
Rogers. He retired from Russell Reynolds Associates in 2018, having been a managing
director for the last 13 years of his executive career there. His principal focus was
advising clients & investors on board appointments and organisation strategy across
biotechnology, MedTech, diagnostics, healthcare services, pharmaceuticals and digital
technologies.
Philippa Latham, MA, MBA, ACIS, FCMA (appointed 1 September 2021) started her
career in corporate finance in the City and has experience in industry as a corporate
analyst. She was a non-executive director from 2005 to 2015 at James Latham PLC, an
AIM listed company, where she served as the chair of the Audit Committee for seven
years. She currently holds four non-executive director roles, one of which is Lucy Group
Limited where she is chair of the Audit Committee.
The Board provides a wide range of relevant experience and skills. Each member
of the Board has demonstrated sufficient time capacity to meet the commitments
required in preparing for, attending and participating in periodic Board meetings and
for all the activities that take place between formal Board meetings as an important
part of the process of oversight and constructive challenge from an independent
board of an investment company. The Board works closely together and reviews
succession and allocation of responsibilities on a regular basis.
36 Albion Enterprise VCT PLC
GOVERNANCE
Patrick Reeve, MA, FCA, (appointed 7 November 2006) was formerly the managing
partner of Albion Capital and became chairman in 2019. He is also a director of Albion
Technology & General VCT and Albion Development VCT. Patrick is on Albion’s Valuation
Committee and its Risk Management Committee. Patrick joined Close Brothers Group
plc in 1989 before establishing Albion Capital Group LLP (originally Close Ventures Ltd)
in 1996. Prior to Close he qualified as a chartered accountant before joining Cazenove &
Co. Patrick has an MA in Modern Languages from Oxford University and a BA in Sanskrit
from SOAS. He is on the Board of a number of charities, including membership of the
Council of the British School at Athens. Patrick, although considered non-independent
for governance purposes, contributes both direct investment experience and a wider
perspective in the venture capital markets.
Rhodri Whitlock (Chairman of the Audit and Risk Committee) (appointed 19
January 2021) is a chartered accountant and has over 25 years’ experience as a partner
providing a range of assurance services and advice to listed and private companies.
During that time Rhodri worked closely with the non-executive boards of a significant
number of investment and infrastructure funds and also gained considerable experience
of high growth businesses and sectors including MedTech, FinTech, software as a
service, healthcare and e-commerce. More recently Rhodri worked with the independent
regulator, the Financial Reporting Council and now runs his own consultancy business,
HPL Associates Limited and AQRA Limited. He is also a member of the ICAEW’s Audit
and Assurance Board.
The Board of Directors
All Directors, except for Patrick Reeve, are members of the Audit and Risk Committee and Rhodri Whitlock is Chairman.
All Directors, except for Patrick Reeve, are members of the Nomination Committee and Maxwell Packe is Chairman.
All Directors, except for Patrick Reeve, are members of the Remuneration Committee and Christopher Burrows is
Chairman.
Christopher Burrows is the Senior Independent Director.
Christopher Burrows will become the new Chairman of the Board and Nomination Committee when Maxwell
Packe retires. When Christopher Burrows becomes Chairman of the Board, Rhodri Whitlock will become the Senior
Independent Director and Philippa Latham will become Chairman of the Remuneration Committee.
37
Will Fraser-Allen, BA
(Hons), FCA, has been
managing partner since
2019 and chairs the
investment committee.
He is on the Board of
the AIC and sits on
the Venture Capital
Committee of the BVCA.
He joined Albion in 2001
and became deputy
managing partner in
2009. He qualified as a
chartered accountant and
has a BA in History from
Southampton University.
Patrick Reeve, MA,
FCA, details included in
the Board of Directors
section. He is on Albion’s
Valuation Committee
and its Risk Management
Committee.
Dr. Andrew Elder, MA,
FRCS, practised as a
neurosurgeon before
starting his career in
investment. He heads up
the healthcare investment
team and became deputy
managing partner in
2019. He joined Albion
in 2005 and became a
partner in 2009. He has
an MA plus Bachelor of
Medicine and Surgery
from Cambridge
University. He is a Fellow
of the Royal College of
Surgeons (England).
Vikash Hansrani, BA
(Hons), FCA, is a partner
and oversees the finance
and administration of
all funds under Albion’s
management. He
qualified as a chartered
accountant with RSM
before joining Albion
in 2010. He has a BA in
Accountancy & Finance
from Nottingham
Business School.
Albion Capital Group LLP, is authorised and regulated by the
Financial Conduct Authority and is the Manager of Albion
Enterprise VCT PLC. Established in 1996, Albion Capital is an
independent investment firm providing investors with access to
entrepreneurs who build enduring businesses.
The following are specifically responsible for the management
and administration of the Venture Capital Trusts managed by
Albion Capital Group LLP:
THE MANAGER
GOVERNANCE
38 Albion Enterprise VCT PLC
Valerie Aelbrecht, MSc,
MSc, joined as investment
associate in 2022. She
was at Cherry Ventures
after being a founder and
operator for 8 years in
the FoodTech space. She
holds an MSc in Applied
Economics from the
University of Antwerp and
an MSc in International
Business Management
& Entrepreneurship from
Kingston University.
Dr. Leigh Brody, PHD,
joined as Investment
Manager in 2021 and
focuses on transformative
technologies
and therapeutics
opportunities emerging
from UCL. She has over a
decade of experience as
a startup founder, gained
her PhD in Biochemistry
from Imperial College
London, and also holds a
BSc in Biochemistry from
Simmons University.
Adam Chirkowski, MA
(Hons), is an investment
director focusing on
B2B and ClimateTech
investments. Prior to
joining Albion in 2013, he
spent five years working
in corporate finance at
Rothschild. He holds
a first-class degree in
Industrial Economics and
a Masters in Corporate
Strategy and Governance
from Nottingham
University.
Emil Gigov, BA (Hons),
FCA, is a partner focusing
on B2B SaaS businesses.
He joined Albion in 2000
and became a partner in
2009. He graduated from
the European Business
School, London, with a
BA in European Business
Administration.
Dr. Molly Gilmartin, BA,
joined in 2022 as an
investment manager from
McKinsey & Company.
Before that, she was
Chief Commercial Officer
of Induction Healthcare
Group which completed
an IPO on AIM in 2019.
Before this she was a
founding team member
of start-up Pando and an
NHS Clinical Entrepreneur
as a medical doctor.
David Grimm, MSc, is
a partner focusing on
DeepTech investments.
He joined Albion in
2016 as investment
manager and was made
partner in 2023. David
has spent 10 years
investing in early-stage
technology-differentiated
opportunities, including
4 years at Spark Ventures
prior to joining Albion. He
holds an MSc in Natural
Sciences.
Ed Lascelles, BA (Hons),
heads up the technology
investment team. He
joined in 2004 having
started his career advising
public companies and
became a partner in
2009. He holds a first-
class honours degree in
Philosophy from UCL.
Paul Lehair, MSc, MA, is
an investment director
who joined in 2019
having spent five years
at Citymapper. He also
worked at Viagogo and
in M&A at Citigroup. He
holds a dual Masters’
degree in European
Political Economy from
the LSE and Political
Science and Sciences
Po Paris.
The Manager
39Albion Enterprise VCT PLC
Catriona McDonald, BA
(Hons), is an investment
director specialising in
technology investing.
She joined in 2018 from
Goldman Sachs where she
worked on IPOs, M&A and
leveraged buyouts in New
York and London. She
graduated from Harvard
University, majoring in
Economics.
Kibriya Rahman, MMath,
joined as investment
associate in 2022.
He was previously at
Funding Circle and
Formula 1. Before this, he
worked at OC&C Strategy
Consultants.
He graduated from
Oxford University with
an MMath degree.
Jane Reddin, BA (Hons),
heads up the platform
team. She joined Albion
in 2020 and became
partner in 2022. Prior
to Albion, she spent six
years as Talent Advisor
at Balderton Capital
and then co-founded
The Talent Stack. She
graduated from Durham
University with a BA in
French and German.
Dr. Christoph Ruedig,
MBA, is a partner focusing
on digital health. He
originally practiced
radiology and was
responsible for M&A in
healthcare at GE and
venture capital with 3i.
He joined Albion in 2011
and became a partner in
2014. He holds a degree
in medicine from Ludwig-
Maximilians University
and an MBA from INSEAD.
Nadine Torbey, MSc,
BEng, is an investment
director who joined in
2018 from Berytech Fund
Management. She holds
a BSc in Electrical and
Computer Engineering
from the American
University of Beirut and
an MSc in Innovation
Management and
Entrepreneurship from
Brown University.
Robert Whitby-Smith, BA
(Hons), FCA, is a partner
focusing on software
investing. His background
was in corporate finance
at KPMG, CSFB and
ING Barings, after
qualifying as a chartered
accountant. He joined
Albion in 2005 and
became a partner in
2009. He graduated from
Reading University with
a BA in History.
Jay Wilson, MBA, MMath,
is a partner focusing on
FinTech. He joined in
2019 from Bain & Co,
where he had been a
consultant since 2016,
and became partner
in 2023. Prior to this
he graduated from the
London Business School
with an MBA having spent
eight years as a broker at
ICAP Securities.
Marco Yu, PhD, MRICS,
heads up the renewables
team and became
partner in 2023. Prior
to joining Albion in
2007, he qualified as a
Chartered Surveyor with
Bouygues and advised
on large capital projects
with EC Harris. He has a
degree in economics from
University of Cambridge
and a PhD in construction
economics from UCL.
40 Albion Enterprise VCT PLC
The Manager
The United Nations Principles for Responsible Investment (“UN PRI”) is the world’s leading proponent of responsible
investment, working to understand the investment implications of ESG factors and to support its international network
of investor signatories in incorporating these factors into their investment and ownership decisions.
As a signatory of the UN PRI, Albion (and the Board) recognise that applying the following six principles better aligns
investors with broader objectives of society:
ENVIRONMENTAL, SOCIAL AND
GOVERNANCE (“ESG”) REPORT
Principle 1: to incorporate ESG issues
into investment analysis and decision-
making processes.
Principle 5: to work together to enhance
our effectiveness in implementing the
Principles.
Principle 2: to be active owners and
incorporate ESG issues into our
ownership policies and practices.
Principle 6: to report on our activities
and progress towards implementing the
Principles.
Principle 3: to seek appropriate
disclosure on ESG issues by the entities
in which we invest.
Principle 4: to promote acceptance and
implementation of the Principles within
the investment industry.
The Company’s Manager, Albion Capital Group LLP (“Albion”),
sees sustainable and responsible investment as an integral part
of its investment mandate. In turn, the Board is kept appraised of
ESG issues in both the portfolio and in how company affairs are
conducted as part of regular Board oversight.
GOVERNANCE
41Albion Enterprise VCT PLC
The Board and Albion have been conscious in making
a commitment to responsible investment in Albion’s
internal and external processes to ensure alignment
with our fundamental commitment to persuing long-
term financial returns for our clients. Today we provide
finance for promising companies across technology,
healthcare and renewable energy. Through this, Albion
is directly involved in the oversight and governance
of these investments, including ensuring standards
of reporting and visibility on business practices, all of
which are reported to the Board.
One of the most important drivers of performance is
the quality of the investment portfolio, which goes
beyond the individual valuations and examines the
prospects of each portfolio company and their sectors –
all of which requires a long-term view.
Given the nature of venture capital investment,
Albion is more intimately involved in the affairs of
portfolio companies than typical funds invested in
listed securities. As such, Albion can influence good
governance and behaviour in portfolio companies,
many of which are relatively small without the support
of a larger company’s administration and advisory
infrastructure.
The Company adheres to the principles of the AIC Code
of Corporate Governance and is also aware of other
governance and corporate conduct guidance which it
meets as far as practical. This includes the constitution
of a diversified and independent Board capable of
providing constructive challenge.
ESG considerations are an integrated part of Albion’s
full investment process, designed to create value
for investors and support portfolio companies
in developing sustainable long-term strategies
for portfolio companies. This is reflected in the
transparency of reporting, governance principles
adopted by the Company and the portfolio companies.
Albion integrates ESG across all aspects of the
investment process:
* The ESG Balanced Scorecard (“ESG BSC”) contains sustainability metrics used to determine a company’s sustainability risks and opportunities,
and track progress over time.
STAGE 1
Screening
STAGE 2
Due diligence
STAGE 3
Stewardship &
monitoring
STAGE 4
Follow on
investments
Exit
• Check company
activity with Albion
Capital Group LLP’s
exclusion list
• Track Founder/
CEO gender for
all potential new
investments
• ESG Due Diligence
questionnaire
completed pre-
investment
• ESG summary
added to investment
committee paper
and reviewed at IC
• ESG terms added
to the template
Shareholders
Agreement
• Leverage portfolio
company board and
platform function
to implement ESG
initiatives
• Collect information
on ESG
developments
annually via ESG
Balance Score
Card (BSC)* and
include in internal
review meetings
when significant
developments have
taken place
• Reassess ESG risks
and opportunities
during each round of
funding
• Use new funding
round to check for
improvements
• Support the
company in
demonstrating to
potential investors
how ESG risks have
been mitigated
and opportunities
realised
• To the extent
possible ensure
good ESG practices
remain in place
following exit
Environmental, Social, and Governance (“ESG”) report
42 Albion Enterprise VCT PLC
An exclusion list is used to rule out investments in unsustainable, socially
detrimental areas. ESG due diligence is performed on each potential
portfolio company to identify any sustainability risks, which are ranked
from low to high and are reported to the relevant investment committee. If
sustainability risks are identified, mitigations are assessed and, if necessary,
mitigation plans are put in place. If this is not deemed sufficient, the
committee would consider the appropriate level and structure of funding to
balance the associated risks. If this is not possible, investment committee
approval will not be provided, and the investment will not proceed.
Albion’s investment deal documents include a sustainability clause that
reinforces individual portfolio company’s commitment to driving principles
of ESG as it scales.
An ESG clause is integrated into the shareholders’ agreement for all new
investments, which outlines the portfolio company’s commitment to
combine economic success with ecological and social success.
All new and existing portfolio companies are asked to report against the
ESG BSC annually. It contains a number of sustainability factors (such as
whether or not the portfolio company has policies or strategies relating to
the environment, carbon emissions or achieving net zero) against which
a portfolio company is assessed and scored in order to determine the
potential sustainability risks and opportunities arising from the investment.
ESG score is reviewed annually, and key priority improvement areas
are identified for the next 12 months. It forms part of Albion’s internal
broader risk review meetings and any outstanding issues are addressed in
collaboration with the portfolio companies’ senior management.
Albion aims to ensure that good ESG practices remain in place following
exit by, for example, ensuring that the portfolio company creates a self-
sustaining ESG management system during our period of ownership,
wherever feasible.
PRE-INVESTMENT STAGE
INVESTMENT STAGE
EXIT STAGE
43Albion Enterprise VCT PLC
Overview of Albion’s ESG activity:
ENVIRONMENTAL
• Albion is transitioning to Net
Zero
• Measuring carbon footprint
and purchased carbon
removal permits for
2023/2024 emissions
• Formation of Albion Net Zero
team to formulate a road
map for transitioning to net
zero
SOCIAL
• Fair HQ score improvement
(from 6.1 to 6.6 out of 10) in
2023
• Albion’s Social Outreach
Team has a mandate on local
educational outreach
• Radia Accelerator launched
to support women
entrepreneurs
GOVERNANCE
• ESG principles integrated
across the full investment
cycle
• Completion of 2023 ESG BSC
portfolio reporting
• UN PRI score 2023: 4/5 stars
• Regular ESG updates for all
stakeholders
Signatories
As a signatory of UN Principles for Responsible Investment (UN PRI) Albion is committed to the six key principles to
incorporate ESG into investment practice.
Albion is a member of VentureESG steering committee, a venture capital-based non-profit initiative to push the
industry on ESG best practices. The current group consists of 300 venture funds and 90 limited partners globally,
who work to make ESG a standard part of the due diligence, portfolio stewardship and internal fund management.
Albion is a proud signatory of the Investing in Women Code, and commits to adopt internal practices that aim to
improve female entrepreneurs’ access to the tools, resources and finance required to scale their companies.
The Manager’s ESG initiatives
ESG is incorporated into Albion’s own internal
operations as follows:
Environmental: Environmental: Committed to
transitioning to a net zero business through our
emissions reduction plan.
Social: Aims to conduct its business in a socially
responsible manner, to contribute to the communities
in which it operates and to respect the needs of all
employees and stakeholders.
Governance: Seeks to conduct business activities in an
honest, ethical and socially responsible manner. These
values underpin its business model and strategy.
44 Albion Enterprise VCT PLC
DIRECTORS’ REPORT
45Albion Enterprise VCT PLC 45
GOVERNANCE
All Ordinary shares (except for treasury shares which
have no right to dividend and no voting rights) rank
pari passu for voting rights and each Ordinary share is
entitled to one vote. The Directors are not aware of any
restrictions on the transfer of shares or on voting rights.
Shareholders are entitled to receive dividends and the
return of capital on winding up or other return of capital
based on the surpluses attributable to the shares.
Issue and buy-back of Ordinary shares
During the year the Company issued a total of
12,181,078 Ordinary shares (2023: 12,909,017 Ordinary
shares) under the Albion VCTs Top Up Offers and 826,009
Ordinary shares (2023: 814,594 Ordinary shares) under
the Company’s Dividend Reinvestment Scheme. Further
information on the share capital is detailed in note 15.
Your Board, in conjunction with the boards of four other
VCTs managed by Albion Capital Group LLP, published
a prospectus Top Up Offer of new Ordinary shares on
15 December 2023. The Offer launched to applications
on 2 January 2024 and closed on 20 March 2024. The
amount raised by the Company was £15.75 million.
The Company operates a policy of buying back shares
either for cancellation or for holding in treasury. Details
regarding the current buy-back policy can be found on
page 12 of the Chairman’s statement and details of
share buybacks during the year can be found in note 15.
Substantial interests and shareholder profile
As at 31 March 2024 and at the date of this Report,
the Company was not aware of any shareholder who
had a beneficial interest exceeding 3% of voting rights.
There have been no disclosures in accordance with
Disclosure Guidance and Transparency Rule 5 made to
the Company during the year ended 31 March 2024,
and up to the date of this Report.
Results and dividends
Detailed information on the results and dividends for
the year ended 31 March 2024 can be found in the
Strategic report on page 15.
Future developments of the business
Details on the future developments of the business can
be found on page 13 of the Chairman’s statement and
on pages 15 to 16 of the Strategic report.
The Directors submit their Annual Report and the
audited Financial Statements on the affairs of Albion
Enterprise VCT PLC (“the Company”) for the year
ended 31 March 2024. The Statement of corporate
governance on pages 53 to 60 forms a part of the
Directors’ report.
BUSINESS REVIEW
Principal activity and status
The principal activity of the Company is that of a
Venture Capital Trust. It has been approved by H.M.
Revenue & Customs (“HMRC”) as a Venture Capital
Trust in accordance with Part 6 of the Income Tax Act
2007 and in the opinion of the Directors, the Company
has conducted its affairs so as to enable it to continue
to obtain such approval. In order to maintain its status
under Venture Capital Trust legislation, a VCT must
comply on a continuing basis with the provisions of
Section 274 of the Income Tax Act 2007 and further
details of this can be found on page 46 of this Directors’
report. Approval for the year ended 31 March 2024
is subject to review should there be any subsequent
enquiry under corporation tax self-assessment.
The Company is not a close company for taxation
purposes and its shares are premium listed on the
official list of the London Stock Exchange.
Under current tax legislation, shares in the Company
provide tax-free capital growth and income distribution,
in addition to the income and capital gains tax relief
some investors would have obtained when they
invested in the Company’s original share offers.
Capital structure
Details of the issued share capital, together with details
of the movements in the Company’s issued share
capital during the year are shown in note 15.
Ordinary shares represent 100% of the total share
capital and voting rights. The Ordinary shares are
designed for individuals who are seeking, over the long
term, investment exposure to a diversified portfolio of
unquoted investments. The investments are spread
over a number of sectors, to produce a regular source
of income, combined with the prospect of longer term
capital growth.
46 Albion Enterprise VCT PLC
1
the Company’s income must be derived wholly
or mainly from shares and securities;
2
at least 80% of the HMRC value of its
investments must have been represented
throughout the year by shares or securities that
are classified as ‘qualifying holdings’;
3
at least 70% by HMRC value of its total
qualifying holdings must have been
represented throughout the year by holdings
of ‘eligible shares’. Investments made before
6 April 2018 from funds raised before 6 April
2011 are excluded from this requirement;
4
at least 30% of funds raised in accounting
periods beginning on or after 6 April 2018
must be invested in qualifying holdings by the
anniversary of the end of the accounting period
in which the funds were raised;
5
at the time of investment, or addition to an
investment, the Company’s holdings in any
one company (other than another VCT) must
not have exceeded 15% by HMRC value of its
investments;
6
the Company must not have retained greater
than 15% of its income earned in the year from
shares and securities;
7
the Company’s shares, throughout the year,
must have been listed on a regulated market;
8
an investment in any company must not cause
that company to receive more than £5 million
in State aid risk finance in the 12 months up
to the date of the investment, nor more than
£12 million in total (the limits are £10 million
and £20 million respectively for a ‘knowledge
intensive’ company);
9
the Company must not invest in a company
whose trade is more than seven years old (ten
years for a ‘knowledge intensive’ company)
unless the company previously received State
aid risk finance in its first seven years, or the
company is entering a new market and a
turnover test is satisfied;
10
the Company’s investment in another company
must not be used to acquire another business,
or shares in another company; and
11
the Company may only make qualifying
investments or certain non-qualifying
investments permitted by Section 274 of the
Income Tax Act 2007.
Going concern
In accordance with the Guidance on Risk Management,
Internal Control and Related Financial and Business
Reporting issued by the Financial Reporting Council
(“FRC”) in 2014, and the subsequent updated Going
concern, risk and viability guidance issued by the FRC in
2021, the Board has assessed the Company’s operation
as a going concern. The Company has sufficient cash
and liquid resources, its portfolio of investments is well
diversified in terms of sector, and the major cash outflows
of the Company (namely investments, buy-backs and
dividends) are within the Company’s control. Cash flow
forecasts are discussed quarterly at Board level with
regards to going concern. The cash flow forecasts have
been updated and stress tested, which included assessing
the resilience of portfolio companies, incorporating the
requirement for any future financial support, including
proceeds from investment disposals only when there
is a high probability of completion, and evaluating the
impact of high inflation within the Company. A budget
has been prepared for the Company for the three year
period to 31 March 2027. Accordingly, the Directors
have a reasonable expectation that the Company has
adequate resources to continue in operational existence
over a period of at least twelve months from the date
of approval of the Financial Statements. For this reason,
the Directors have adopted the going concern basis in
preparing the accounts. The Directors do not consider
there to be any material uncertainty over going concern.
The Company’s policies for managing its capital and
financial risks are shown in note 17 and includes the
Board’s assessment of areas including liquidity risk,
credit risk and price risk. The Company’s business
activities, together with details of its performance are
shown in the Strategic report and this Directors’ report.
Post balance sheet events
Details of events that have occurred since 31 March
2024 are shown in note 19.
Principal risks and uncertainties
A summary of the principal risks faced by the Company
is set out on pages 22 to 25 of the Strategic report.
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
Venture Capital Trust legislation, a VCT must comply on
a continuing basis with the provisions of Section 274 of
the Income Tax Act 2007 as follows:
Directors’ report
47Albion Enterprise VCT PLC
These tests drive a spread of investment risk through
preventing holdings of more than 15% by HMRC value
in any portfolio company. The tests have been carried
out and independently reviewed for the year ended 31
March 2024. The Company has complied with all tests
and continues to do so.
‘Qualifying holdings’ include shares or securities
(including unsecured loans with a five year or greater
maturity period) in companies which have a permanent
establishment in the UK and operate a ‘qualifying
trade’ wholly or mainly in the United Kingdom. The
investment must bear a sufficient level of risk to meet a
risk-to-capital condition. Eligible shares must comprise
at least 10% by HMRC value of the total of the shares
and securities that the Company holds in any one
portfolio company. ‘Qualifying trade’ excludes, amongst
other sectors, dealing in property or shares and
securities, insurance, banking and agriculture. Details
of the sectors in which the Company is invested can be
found in the pie chart on page 14.
A ‘knowledge intensive’ company is one which is
carrying out significant amounts of R&D from which
the greater part of its business will be derived, or where
those R&D activities are being carried out by staff with
certain higher educational attainments.
Portfolio company gross assets must not exceed £15
million immediately prior to the investment and £16
million immediately thereafter.
On 31 March 2024, the HMRC value of qualifying
investments (which includes a 12 month disregard
for disposals) was 93.08% (2023: 95.81%). The Board
continues to monitor this and all the VCT qualification
requirements very carefully in order to ensure that all
requirements are met and that qualifying investments
comfortably exceed the current minimum threshold of
80% required for the Company to continue to benefit
from VCT tax status. The Board and Manager are
confident that the qualifying requirements can be met
during the course of the year ahead.
Environment
The management and administration of the
Company is undertaken by the Manager. Albion
Capital Group LLP recognises the importance of its
environmental responsibilities, monitors its impact on
the environment, and designs and implements policies
to reduce any damage that might be caused by its
activities. The Company has taken initiatives designed
to reduce its impact on the environment by favouring
digital over printing when communicating with its
shareholders. Further details can be found in the
Environmental, Social, and Governance (“ESG”) report
on pages 41 to 44.
Global greenhouse gas emissions
The Company qualifies as a low energy user with
regards to greenhouse gas emissions, producing
less than 40,000kWh of energy, and therefore is not
required to report emissions from the operations of the
Company, nor does it have responsibility for any other
emissions producing sources under the Companies
Act 2006 (Strategic report and Directors’ reports)
Regulations 2013, including those within our underlying
investment portfolio. Therefore, the Company is outside
of the scope of Streamlined Energy Carbon Reporting.
Anti-bribery
The Company has a zero tolerance approach to bribery,
and will not tolerate bribery under any circumstances in
any transaction the Company is involved in.
The Manager reviews the anti-bribery policies and
procedures of all portfolio companies.
Anti-facilitation of tax evasion
The Company has a zero tolerance approach with
regards to the facilitation of criminal tax evasion and
has a robust risk assessment procedure in place to
ensure compliance. The Board reviews this policy and
the prevention procedures in place for all associates on
a regular basis.
48 Albion Enterprise VCT PLC
Diversity
The Board’s policy on the recruitment of new Directors is
to attract a range of backgrounds, skills and experience
and to ensure that appointments are made on the
grounds of merit against clear and objective criteria and
bear in mind gender and other diversity within the Board.
The Board is required to disclose their compliance
in relation to the targets on board diversity set out
under paragraph 9.8.6R (9) of the Listing Rules (and
corresponding AIC guidance). These are as follows:
(i) at least 40% of the individuals on the Board of
Directors are women;
(ii) at least one of the senior positions on the Board
of Directors is held by a woman; and
(iii) at least one individual on the Board of Directors
is from a minority ethnic background.
The Board of Directors self-reported their gender
identity and ethnic background, which offered each of
the categories noted in the table below, along with the
additional option to indicate an ‘other category’, should
they wish to do so.
As at 31 March 2024, the breakdown of the gender
identity and ethnic background of the Board is found in
the table below.
The Board notes that they did not meet any of the
three targets. Due to the small size of the Board, any
change in the board membership will have a much
greater impact on representation. Therefore on future
succession and recruitment of members of the Board,
the diversity in gender identity and ethnic background
will be thoroughly considered.
Directors’ report
Number of
Board members
Percentage
of the Board
Senior Board
Position
Gender Identity
Men 4 80% 2
Women 1 20% -
Not specified/prefer not to say - - -
Number of
Board members
Percentage
of the Board
Ethnic Background
White British or other White (including minority-white groups) 5 100%
Mixed/Multiple Ethnic Groups - -
Asian/Asian British - -
Black/African/Caribbean/Black British - -
Other ethnic group, including Arab - -
Not specified/prefer not to say - -
More details on the Directors can be found in the Board
of Directors section on pages 36 and 37.
Packaged Retail and Insurance-based
Investment Products (“PRIIPs”)
Investors should be aware that the PRIIPs Regulation
requires the Manager, as PRIIP manufacturer, to
prepare a Key Information Document (“KID”) in respect
of the Company. This KID must be made available
by the Manager to retail investors prior to them
making any investment decision and is available on
the Company’s webpage on the Manager’s website.
The Company is not responsible for the information
contained in the KID and investors should note that
the procedures for determining the risks, costs and
potential returns are prescribed by the law.
Alternative Investment Fund Managers
Directive (“AIFMD”)
Under the Alternative Investment Fund Manager
Regulations 2013 (as amended) the Company is a UK
AIF and the Manager is a full scope UK AIFM. Ocorian
Depositary (UK) Limited provides depositary services
under the AIFMD.
Material changes to information required to be made
available to investors of the Company
The AIFMD outlines the required information which
has to be made available to investors prior to investing
in an AIF and directs that material changes to this
information be disclosed in the Annual Report of the
AIF. There were no material changes in the year.
49
Assets of the Company subject to special arrangements
arising from their illiquid nature
There are no assets of the Company which are subject
to special arrangements arising from their illiquid
nature.
Remuneration (unaudited)
The Manager has a remuneration policy which
meets the requirements of the AIFMD Remuneration
Code and associated Financial Conduct Authority
guidance. The remuneration policy together with the
remuneration disclosures for the AIFM’s most recent
reporting period are available on the Company’s
webpage on the Manager’s website.
Employees
The Company is managed by Albion Capital Group LLP
and hence has no employees.
Directors
The Directors who held office throughout the year, and
their interests in the shares of the Company (together
with those of their immediate family) are shown in the
Directors’ remuneration report on page 63.
All Directors, except for Patrick Reeve, are members
of the Audit and Risk Committee, of which Rhodri
Whitlock is Chairman.
Patrick Reeve, as chairman of Albion Capital Group
LLP, is deemed to have an interest in the Management
agreement and Management performance incentive to
which the Company is party.
Directors’ indemnity
Each Director has entered into a Deed of Indemnity with
the Company which indemnifies each Director, subject
to the provisions of the Companies Act 2006 and the
limitations set out in each deed, against any liability
arising out of any claim made against themselves in
relation to the performance of their duties as a Director
of the Company. A copy of each Deed of Indemnity
entered into by the Company with each Director is
available at the registered office of the Company.
The Company also has Directors’ & Officers’ Liability
Insurance in place. Further details of this can be found in
the Director’s remuneration report on page 63.
Directors’ report
Re-election of Directors
Directors’ re-election is subject to the Articles of
Association and the UK Corporate Governance Code.
The AIC Code recommends that all Directors submit
themselves for re-election annually, therefore in
accordance with the AIC Code, Christopher Burrows,
Philippa Latham, Patrick Reeve and Rhodri Whitlock
will offer themselves for re-election. Maxwell Packe,
who has served on the Board since 2006, is not putting
himself forward for re-election.
Advising ordinary retail investors
The Company currently conducts its affairs so that its
shares can be recommended by financial intermediaries
to ordinary retail investors in accordance with the
FCA’s rules in relation to non-mainstream investment
products and intends to continue to do so for the
foreseeable future. The FCA’s restrictions which apply
to non-mainstream investment products do not apply
to the Company’s shares because they are shares in
a Venture Capital Trust which, for the purposes of the
rules relating to non-mainstream investment products,
are excluded securities and may be promoted to
ordinary retail investors without restriction.
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.
Auditor
The Audit and Risk Committee annually reviews and
evaluates the standard and quality of service provided
by the Auditor, as well as value for money in the
provision of these services.
As announced on 30 October 2023, following a formal
and rigorous audit tender process, the Company was
pleased to announce the appointment of Johnston
Carmichael LLP (“Johnston Carmichael”) as the
Company’s Auditor with immediate effect. Johnston
Carmichael have conducted the audit of the Annual
Report and Financial Statements for the year ended 31
March 2024.
50 Albion Enterprise VCT PLC
Directors’ report
Annual General Meeting
The Company’s AGM will be held virtually at noon on
3 September 2024 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 AGM will include a presentation from the
Manager, the answering of questions received from
shareholders and the formal business of the AGM,
which includes voting on the resolutions proposed
by the Board. The Chairman will elect at the meeting
that voting on the resolutions will take place by way
of a poll. Registration details for the webcast will be
emailed to shareholders and will be available at www.
albion.capital/vct-hub/agms-events prior to the AGM.
The Board welcomes questions from shareholders
at the AGM and shareholders will be able to ask
questions using the Lumi platform during the AGM.
Alternatively, shareholders can email their questions
to AAEVchair@albion.capital prior to the AGM.
Questions asked will be answered during the meeting
in so far as possible.
Given that the Company has some 10,000
shareholders, to enable the Board and the Manager
to respond to questions, and to ensure sufficient time
is devoted to managing the assets on behalf of the
shareholders, we ask that you submit no more than
two questions per shareholder, which should be of a
substantive nature and relating to the business being
dealt with at the meeting.
Shareholders will be able to vote during the AGM
using the Lumi platform. Shareholders are encouraged
to complete and return proxy cards in advance of the
AGM but those participating in the Meeting will be
able to cast their votes through the Lumi platform
once the Chairman declares the poll open.
The results of the poll held at the AGM will
be announced through a Regulatory Information
Service and will be published on the Company’s
webpage on the Manager’s website at
www.albion.capital/funds/AAEV as soon as
reasonably practicable following the Meeting.
Shareholders’ views are important, and the Board
encourages shareholders to vote on the resolutions.
You can cast your vote by using the proxy form
enclosed with this Annual Report or electronically
at www.investorcentre.co.uk/eproxy. The Board has
carefully considered the business to be approved at
the AGM and recommends shareholders to vote in
favour of all the resolutions being proposed.
Full details of the business to be conducted at the
AGM are given in the Notice of the Meeting on pages
92 to 95.
The ordinary business resolutions 1 to 8 includes
receiving and adopting the Company’s accounts, to
approve the Directors’ annual remuneration report,
to re-elect Directors (excluding Maxwell Packe who
will retire during the year), and to appoint Johnston
Carmichael LLP as auditor for the next year end and
to fix their remuneration.
Resolutions relating to the following items of special
business will be proposed at the forthcoming AGM
for which shareholder approval is required in order to
comply either with the Companies Act or the Listing
Rules of the Financial Conduct Authority.
Resolution numbers 10 to 12 replace the authorities
given to the Directors at the AGM in 2023. The
authorities sought at the forthcoming AGM will expire
15 months from the date that the resolution is passed
or at the conclusion of the next AGM of the Company,
whichever is earlier.
Increase in Directors’ aggregate remuneration
limit
Ordinary resolution number 9 to be proposed as special
business at the Annual General Meeting increases the
limit for the overall level of Directors’ remuneration under
the Company’s Articles of Association from £125,000 to
£150,000 per annum. The Directors are currently paid
Directors’ fees aggregating £112,000 per annum. The
new level proposed under the Articles of Association
provides extra flexibility over the coming years.
Authority to allot shares
Ordinary resolution number 10 will request the
authority for the Directors to allot up to an aggregate
nominal amount of £257,613 representing
approximately 20% of the issued Ordinary share
capital of the Company as at the date of this report.
During the year, Ordinary shares were allotted as
described in note 15.
51Albion Enterprise VCT PLC
Annual General Meeting (continued)
The Directors current intention is to allot shares under
the Dividend Reinvestment Scheme and any Albion
VCTs Top Up Offers. The Company currently holds
16,612,548 Ordinary shares in treasury representing
12.9% of the total Ordinary share capital in issue as at
31 March 2024.
Disapplication of pre-emption rights
Special resolution number 11 will request the
authority for the Directors to allot equity securities
for cash without first being required to offer such
securities to existing members. This will include the
sale on a non pre-emptive basis of any shares the
Company holds in treasury for cash. The authority
relates to a maximum aggregate of £257,613 of
the nominal value of the share capital representing
approximately 20% of the issued Ordinary share
capital of the Company as at the date of this report.
Purchase of own shares
Special resolution number 12 will request the
authority to purchase 14.99% of the Company’s
issued Ordinary share capital at, or between the
minimum and maximum prices specified in resolution
number 12. Shares bought back under this authority
may be cancelled or held in treasury.
The Board believes that it is helpful for the Company
to continue to have the flexibility to buy its own
shares and this resolution seeks authority from
shareholders to do so. During the year under financial
review, the Company purchased 2,054,182 Ordinary
shares which are held in treasury, at an aggregate
consideration of £2,450,000 representing 1.6% of
called up share capital. Further information is shown
in note 15.
Notice period for General Meetings
Special resolution number 13 proposes that a General
Meeting, other than an Annual General Meeting, may
be called on not less than 14 clear days’ notice.
Recommendation
The Board believes that the passing of the resolutions
above are in the best interests of the Company and its
shareholders as a whole and accordingly, unanimously
recommends that you vote in favour of these
resolutions, as the Directors intend to do in respect of
their own shareholdings.
Disclosure of information to Auditor
In the case of the persons who are Directors of the
Company at the date of approval of this report:
• so far as each of the Directors are aware, there
is no relevant audit information of which the
Company’s Auditor is unaware; and
• each of the Directors has taken all the steps
that they ought to have taken as a Director to
make themselves aware of any relevant audit
information and to establish that the Company’s
Auditor is aware of that information.
This disclosure is given and should be interpreted in
accordance with the provisions of Section 418 of the
Companies Act 2006.
By Order of the Board
Albion Capital Group LLP
Company Secretary
1 Benjamin Street
London, EC1M 5QL
11 July 2024
Directors’ report
The Directors are responsible for preparing the Annual
Report and Financial Statements in accordance with
applicable law and regulations.
Company law requires the Directors to prepare
Financial Statements for each financial year. Under
that law the Directors have elected to prepare the
Company’s Financial Statements in accordance with
United Kingdom Generally Accepted Accounting
Practice (“UK GAAP”) (United Kingdom Accounting
Standards and applicable law). Under company law the
Directors must not approve the Financial Statements
unless they are satisfied that they give a true and fair
view of the state of affairs of the Company and of the
profit or loss for the Company for that period.
In preparing these Financial Statements, the Directors
are required to;
• select suitable accounting policies and then
apply them consistently;
• make judgements and accounting estimates that
are reasonable and prudent;
• state whether they have been prepared in
accordance with UK GAAP subject to any
material departures disclosed and explained in
the Financial Statements;
• prepare the Financial Statements on the going
concern basis unless it is inappropriate to
presume that the Company will continue in
business: and
• prepare a Directors’ report, a Strategic report and
Directors’ remuneration report which comply with
the requirements of the Companies Act 2006.
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and
explain the Company’s transactions and disclose with
reasonable accuracy at any time the financial position
of the Company and enable them to ensure that the
Financial Statements comply with the Companies Act
2006. They are also responsible for safeguarding the
assets of the Company and hence for taking reasonable
steps for the prevention and detection of fraud and
other irregularities.
Website publication
The Directors are responsible for ensuring the Annual
Report and Financial Statements are made available
on a website. Financial Statements are published on
the Company’s webpage on the Manager’s website
(www.albion.capital/funds/AAEV) in accordance with
legislation in the United Kingdom governing the
preparation and dissemination of Financial Statements,
which may vary from legislation in other jurisdictions.
The Company’s webpage is maintained on the Boards’
behalf by the Manager.
The work carried out by the Auditor does not involve
consideration of the maintenance and integrity of
the website and, accordingly, the Auditor accepts no
responsibility for any changes that have occurred to the
Financial Statements since they were initially presented
on the website.
Directors’ responsibilities pursuant to Disclosure
Guidance and Transparency Rule 4 of the UK
Listing Authority
The Directors confirm to the best of their knowledge:
• The Financial Statements which have been
prepared in accordance with UK GAAP and give
a true and fair view of the assets, liabilities,
financial position and profit of the Company.
• The Annual Report includes a fair review of the
development and performance of the business
and the financial position of the Company,
together with a description of the principal risks
and uncertainties that it faces; and
• The Annual Report and Financial Statements
taken as a whole is fair, balanced and
understandable and provides the information
necessary for shareholders to assess the
Company’s position and performance, business
model and strategy.
For and on behalf of the Board
Maxwell Packe
Chairman
11 July 2024
STATEMENT OF DIRECTORS’ RESPONSIBILITIES
52 Albion Enterprise VCT PLC
GOVERNANCE
STATEMENT OF DIRECTORS’ RESPONSIBILITIES
Background
The Financial Conduct Authority requires all companies
listed on a regulated market to disclose how they have
applied the principles and complied with the provisions
of the UK Corporate Governance Code (the “Code”)
issued by the Financial Reporting Council (“FRC”) in
2018.
The Board has considered the Principles and Provisions
of the AIC Code of Corporate Governance (“AIC Code”).
The AIC Code addresses the Principles and Provisions
set out in the Code, as well as setting out additional
Provisions on issues that are of specific relevance
to the Company and other investment companies.
Closed-ended investment companies have particular
factors which have an impact on their governance
arrangements, principally from four features:
outsourcing their day-to-day activities to external
service providers and being governed by boards of non-
executive directors; the importance of the Manager in
the outsourcing compared to a typical supplier; having
no executive directors or employees and consequently
no executive remuneration packages; and no customers
in the traditional sense, only shareholders.
The Board considers that reporting against the Principles
and Provisions of the AIC Code, which has been endorsed
by the FRC, provides more relevant information to
shareholders. The Company has complied with the
Principles and Provisions of the AIC Code.
The AIC Code is available on the AIC website (www.
theaic.co.uk). It includes an explanation of how the AIC
Code adapts the Principles and Provisions set out in the
Code to make them relevant for investment companies.
Board of Directors
The Board consists solely of non-executive Directors.
Maxwell Packe is the Chairman, Christopher Burrows is
the Senior Independent Director, and Rhodri Whitlock
is the chairman of the Audit and Risk Committee. From
3 September 2024, Christopher Burrows will be the
Chairman. All Directors are non-executive and day-to-
day management responsibilities are sub-contracted to
the Manager.
Maxwell Packe, Christopher Burrows, Philippa Latham
and Rhodri Whitlock are considered independent
Directors. Patrick Reeve is not an independent Director
as he is chairman of Albion Capital Group LLP, the
Manager. The Board will continue to act independently
of the Manager and the Directors consider that the size
of the Board is adequate to meet the Company’s future
needs.
The Board does not have a policy of limiting the tenure
of any Director as the Board does not consider that a
Director’s length of service reduces their ability to act
independently of the Manager. Maxwell Packe who has
been a Director of the Company for more than nine
years will retire at the forthcoming AGM.
The AIC Code requires that all Directors submit
themselves for re-election annually, therefore in
accordance with the AIC Code, Christopher Burrows,
Philippa Latham, Patrick Reeve and Rhodri Whitlock
will offer themselves for re-election. Maxwell Packe will
retire as a Director on 3 September 2024.
The Directors have a range of business and financial
skills which are relevant to the Company; these are
described in the Board of Directors section on page
36 and 37. All of the Directors have demonstrated
that they have sufficient time, skill and experience to
acquit their Board responsibilities and to work together
effectively. Directors are provided with key information
on the Company’s activities, including regulatory
and statutory requirements, and internal controls,
by the Manager. The Board has access to secretarial
advice and compliance services by the Manager, who
is responsible for ensuring that Board procedures are
followed and applicable procedures complied with. All
Directors are able to take independent professional
advice in furtherance of their duties if necessary. The
Company has in place Directors’ & Officers’ Liability
Insurance.
The Directors have considered diversity in relation to
the composition of the Board and have concluded that
its membership is diverse in relation to experience and
balance of skills. Further details on diversity can be
found on page 48. Further details on the recruitment
53Albion Enterprise VCT PLC
STATEMENT OF CORPORATE GOVERNANCE
GOVERNANCE
of new directors can be found in the Nomination
Committee section on page 58.
The Board met four times during the year as part of
its regular programme of Board meetings, with all
Directors attending each meeting. The table below sets
out the Directors’ attendance at Board and Committee
meetings during the year ended 31 March 2024, with
the number of meetings each Director was eligible to
attend in brackets.
A sub-committee of the Board comprising at least
two Directors met during the year to allot shares
issued under the Dividend Reinvestment Scheme and
the Albion VCTs’ Top Up Offers and also met during
the year to approve the terms and contents of the
Offer documents under the Albion VCTs’ Prospectus
Top Up Offers, and the appointment of Johnston
Carmichael as the Company’s Auditor. There is regular
contact between individual members of the Board.
Representatives of the Manager attend Board meetings
and participate in Board discussions, other than on
matters where there might be a perceived conflict of
interest between the Manager and the Company.
The Chairman ensures that all Directors receive, in a
timely manner, all relevant management, regulatory
and financial information. The Board receives and
considers reports regularly from the Manager and
other key advisers, and ad hoc reports and information
are supplied to the Board as required. The Board has
a formal schedule of matters reserved for it and the
agreement between the Company and its Manager
sets out the matters over which the Manager has
authority and limits beyond which Board approval must
be sought.
The Manager has authority over the management of
the investment portfolio, the organisation of custodial
services, accounting, secretarial and administrative
services, all of which are subject to Board oversight. The
main issues reserved for the Board include:
• the appointment, evaluation, remuneration and
removal of the Manager;
• the consideration and approval of future
developments or changes to the investment
policy, including risk and asset allocation;
• consideration of corporate strategy and
corporate events that arise;
• application of the principles of the AIC Code,
corporate governance and internal control;
• review of sub-committee recommendations,
including the recommendation to shareholders
for the appointment and remuneration of the
Auditor;
• approving the Annual Report and Financial
Statements, the Half-yearly Financial Report,
the Interim Management Statements (which
the Company will continue to publish), net
asset value updates (where required), and the
associated announcements;
• approval of the dividend policy and payments of
appropriate dividends to shareholders;
• the performance of the Company, including
monitoring of the discount of share price to the
net asset value;
• share buy-back and treasury share policies;
• participation in dividend re-investment schemes
and Top Up Offers; and
• monitoring shareholder profile and considering
shareholder communications.
Statement of corporate governance
Board
Audit and Risk
Committee
Nomination
Committee
Remuneration
Committee
Maxwell Packe 4 (4) 2 (2) 1 (1) 1 (1)
Christopher Burrows
4 (4) 2 (2) 1 (1) 1 (1)
Philippa Latham 4 (4) 2 (2) 1 (1) 1 (1)
Patrick Reeve 4 (4) n/a n/a n/a
Rhodri Whitlock 4 (4) 2 (2) 1 (1) 1 (1)
54
Given the size, nature and complexity of the Company,
the Board considers it unnecessary to establish a
Management Engagement Committee.
It is the responsibility of the Board to present an
Annual Report and Financial Statements that are fair,
balanced and understandable, which provides the
information necessary for shareholders to assess the
position, performance, strategy and business model of
the Company.
Committees’ and Directors’ performance
evaluation
Performance of the Board and the Directors is assessed
on the following:
• attendance at Board and Committee meetings;
• the contribution made by individual Directors at,
and outside of, Board and Committee meetings;
and
• completion of a detailed internal assessment
process and annual performance evaluation
conducted by the Chairman. The Senior
Independent Director reviews the Chairman’s
annual performance evaluation.
The evaluation process has consistently identified
that the Board works well together and has the
right balance of skills, experience, independence
and knowledge for the effective governance of the
Company. Diversity within the Board is achieved
through the appointment of directors with different
sector experiences, skills and gender.
Directors are offered training, both at the time of
joining the Board and on other occasions where
required. The Directors attend external courses and
industry events which provide further experience to
help them fulfil their responsibilities. The Board also
undertakes a proper and thorough evaluation of its
committees on an annual basis.
In light of the performance of the individual Directors
and the structured performance evaluation, Maxwell
Packe, Christopher Burrows, Philippa Latham, Patrick
Reeve and Rhodri Whitlock, are considered to be
effective Directors who demonstrate strong commitment
to the role. The Board believes it to be in the best
interest of the Company to re-appoint these Directors
at the forthcoming AGM (except for Maxwell Packe
who is retiring) and has nominated them for re-election
accordingly. For more details on the specific background,
skills and experience of each Director, please see the
Board of Directors section on pages 36 to 37.
Remuneration Committee
The Remuneration Committee consists of all Directors
except Patrick Reeve, with Christopher Burrows
as Chairman. The Committee meets annually to
review both Directors’ responsibilities and salaries
against the market. The Committee held one formal
meeting during the year. The terms of reference for
the Remuneration Committee can be found on the
Company’s webpage on the Manager’s website at
www.albion.capital/funds/AAEV under the Corporate
Governance section.
Audit and Risk Committee
The Audit and Risk Committee consists of all Directors
except Patrick Reeve, with Rhodri Whitlock as Chairman.
In accordance with the AIC Code, members of the Audit
and Risk Committee have recent and relevant financial
experience, as well as experience relevant to the sector.
Given the size of the Board and the complexity of the
business, Maxwell Packe is both Chairman of the Board
and a member of the Audit and Risk Committee as his
background, skills and experience are relevant for the
Committee’s responsibilities. The Committee met twice
during the year ended 31 March 2024.
The independent Auditor, Johnston Carmichael, attended
the Audit and Risk Committee meeting at which
the Annual Report and Financial Statements for the
year ended 31 March 2024 were discussed. Johnston
Carmichael also met with the Audit and Risk Committee
prior to the meeting without the presence of the Manager.
Written terms of reference have been constituted for
the Audit and Risk Committee and can be found on
the Company’s webpage on the Manager’s website at
www.albion.capital/funds/AAEV under the Corporate
Governance section.
During the year under review, the Audit and Risk
Committee discharged its responsibilities including:
• formally reviewing the Annual Report and
Financial Statements and the Half-yearly
Financial Report, with particular focus on the
main areas requiring judgement and on critical
accounting policies;
Statement of corporate governance
55Albion Enterprise VCT PLC
• reviewing the effectiveness of the internal
controls system and examination of the
Internal Controls Report produced by the
Manager;
• meeting with the external Auditor, reviewing
their findings and evaluating their performance;
• reviewing the performance of the Manager and
making recommendations regarding their re-
appointment to the Board;
• highlighting the key risks and specific
issues relating to the Financial Statements
including the reasonableness of valuation,
compliance with accounting standards and
UK law, corporate governance and listing
and disclosure rules as well as going concern
and viability statements. These issues were
addressed through detailed review, discussion
and challenge by the Board of these matters,
as well as by reference to underlying technical
information to back-up the discussions. Taking
into account risk factors that impact on the
Company both as reflected in the annual
accounts and in a detailed risk matrix, both
of which are reviewed periodically in detail,
including in the context of emerging risks;
• advising the Board on whether the Annual
Report and Financial Statements, taken as a
whole, is fair, balanced and understandable
and provides the information necessary for
shareholders to assess the Company’s position,
performance, business model and strategy; and
• reporting to the Board on how it has discharged
its responsibilities.
The Committee also examines going concern and
viability statements, using financial projections
provided by the Manager on the Company and by
examining the liquidity in the Company’s portfolio,
including cash and realisable investments, the
committed costs of the Company and where liquidity
might be found if required. The Audit and Risk
Committee also receives regular reports on compliance
with VCT status, which is subject to various internal
controls and external review when investment
commitments are made.
On 26 June 2023, the Audit and Risk Committee
commenced a formal audit tender process, and several
firms were invited to tender. The most recent audit
tender was conducted in 2017, and the Committee
thought it was appropriate to undertake a formal
tender process to evaluate and review the provision
of the audit services in the market place. Part of the
consideration for the tender process was that BDO had
been the Company’s Auditor for 16 years and were
approaching the end of their maximum period.
During the audit tender process, prospective auditors
were evaluated using guidance issued by the Financial
Reporting Council in February 2017 and the Board
completed a two-stage process which considered and
evaluated relevant expertise, audit firm quality, audit
firm resilience and value for money.
Following the completion of the audit tender process, the
Audit and Risk Committee recommended that Johnston
Carmichael LLP (“Johnston Carmichael”) be appointed
as the Company’s new Auditor. Accordingly, resolution 7
in the Notice of the AGM proposes the appointment of
Johnston Carmichael as the Company’s Auditor.
56 Albion Enterprise VCT PLC
Financial Statements
The Audit and Risk Committee has initial responsibility
for reviewing the Financial Statements and reporting
on any significant issues that arise in relation to the
audit of the Financial Statements as outlined below.
Such issues were communicated with the external
Auditor with the approval of the audit strategy
and at the completion of the audit of the Financial
Statements. No conflicts arose between the Audit and
Risk Committee and the external Auditor in respect of
their work during the year.
The key accounting and reporting issues considered by
the Committee were:
The valuation of the Company’s investments
Valuations of investments are prepared by the
Manager. The Audit and Risk Committee reviewed
the estimates and judgements made in relation to
these investments and were satisfied that they were
appropriate. The Audit and Risk Committee also
discussed the controls in place over the valuation
of investments. The Audit and Risk Committee
recommended investment valuations to the Board for
approval.
Revenue recognition
The revenue generated from loan stock interest and
dividend income has been considered by the Audit
and Risk Committee as part of its review of the
Annual Report as well as a quarterly review of the
management accounts prepared by the Manager.
The Audit and Risk Committee has considered the
controls in place over revenue recognition to ensure
that amounts received are in line with expectation and
budget.
Following detailed reviews of the Annual Report and
Financial Statements and consideration of the key
areas of risk identified, the Board, as a whole, have
concluded that the Financial Statements are fair,
balanced and understandable and that they provide
the information necessary for shareholders to assess
the Company’s position, performance, business model
and strategy.
Relationship with the external Auditor
The Audit and Risk Committee reviews the performance
and continued suitability of the Company’s external
Auditor on an annual basis. They assess the external
Auditor’s independence, qualification, extent of
relevant experience, effectiveness of audit procedures
as well as the robustness of their quality assurance
procedures. In advance of each audit, the Committee
obtains confirmation from the external Auditor that
they are independent and of the level of non-audit
fees earned by them and their affiliates. No non-audit
services were provided during the financial year end 31
March 2024.
As part of its work, the Audit and Risk Committee has
undertaken a formal evaluation of the external Auditor
against the following criteria:
• Qualification
• Expertise
• Resources
• Effectiveness
• Independence
• Leadership
In order to form a view of the effectiveness of the
external audit process, the Audit and Risk Committee
took into account information from the Manager
regarding the audit process, the formal documentation
issued to the Audit and Risk Committee and the Board
by the external Auditor regarding the external audit for
the year ended 31 March 2024, and assessments made
by individual Directors.
The Audit and Risk Committee also has an annual
meeting with the external Auditor, without the
Manager present, at which pertinent questions are
asked to help the Audit and Risk Committee determine
if the Auditor’s skills and approach to the annual audit
and issues that arise during the course of the audit
match all the relevant and appropriate criteria for the
audit to have been an effective and objective review of
the Company’s year-end reporting.
Following the formal audit tender process in the year,
detailed above on page 56, Johnston Carmichael has
been appointed as auditor, subject to approval at the
forthcoming AGM. Johnston Carmichael will rotate the
senior statutory auditor responsible for the audit every
five years.
The core legislation mandates that the maximum
period for which a firm can be appointed auditor of
a public interest entity is 10 years. Member states
can choose to make this period shorter, or they can
choose to allow extensions: to 20 years if a competitive
tender is held at the 10 year point. This is the first year
Statement of corporate governance
57Albion Enterprise VCT PLC
that Johnston Carmichael has acted as Auditor for
the year ended 31 March 2024 and therefore the last
year Johnston Carmichael can act as auditor before
a mandatory tender process is required is 31 March
2033. This year is the first year that Bryan Shepka has
acted as audit engagement partner. The Company
can confirm that there are no contractual obligations
that restrict the Company’s choice of external auditor.
The Audit and Risk Committee annually reviews and
evaluates the standard and quality of service provided
by the Auditor, as well as value for money in the
provision of these services.
The Audit and Risk Committee has concluded
that Johnston Carmichael is independent of the
Company and recommended that a resolution for the
appointment of Johnston Carmichael as the Company’s
Auditor should be put to the forthcoming AGM.
Nomination Committee
The Nomination Committee consists of all Directors,
apart from Patrick Reeve, with Maxwell Packe as
Chairman. From 3 September 2024, Christopher
Burrows will be Chairman of the Nomination
Committee. The terms of reference of the Nomination
Committee are to evaluate the balance of skills,
experience and time commitment of the current Board
members and make recommendations to the Board as
and when a particular appointment arises.
The Board’s policy on the recruitment of new Directors
is to attract a range of backgrounds, skills and
experience and to ensure that appointments are made
on the grounds of merit against clear and objective
criteria and bear in mind gender and other diversity
within the Board. The Board is also mindful of the
importance of creating good working relationships
within the Board and with external agents. The
Nomination Committee reviews succession planning
regularly which includes considering tenure of existing
Board members and any potential skills gaps that
might need to be addressed when board membership
changes.
The Nomination Committee held one formal meeting
during the year. As the Board underwent succession
planning, there had been a number of sessions to
discuss the succession plan, with Maxwell Packe retiring
after the upcoming AGM and Christopher Burrows
being appointed to the role of Chairman.
The terms of reference for the Nomination Committee
can be found on the Company’s webpage on the
Manager’s website at www.albion.capital/funds/AAEV
under the Corporate Governance section.
Internal control
In accordance with the AIC Code, the Board has an
established process for identifying, evaluating and
managing the significant risks faced by the Company.
This process has been in place throughout the year
and continues to be subject to regular review by the
Board in accordance with the FRC guidance “Risk
Management, Internal Control and Related Financial
and Business Reporting”. The Board is responsible
for the Company’s system of internal control and for
reviewing its effectiveness. However, acknowledging
that such a system is designed to manage, rather than
eliminate the risks of failure to achieve the Company’s
business objective and can only provide reasonable and
not absolute assurance against material misstatement
or loss.
The Board, assisted by the Audit and Risk Committee,
monitors all controls, including financial, operational
and compliance controls, and risk management. The
Audit and Risk Committee receives each year from
the Manager a formal report, which details the steps
taken to monitor the areas of risk, including those
that are not directly the responsibility of the Manager,
and which reports the details of any known internal
control failures. Steps continue to be taken to embed
the system of internal control and risk management
into the operations and culture of the Company and its
key suppliers, and to deal with areas of improvement
which come to the Manager’s and the Audit and Risk
Committee’s attention.
Statement of corporate governance
58
The Board, through the Audit and Risk Committee,
has performed a specific assessment for the purpose
of this Annual Report. This assessment considers all
significant aspects of internal control arising during the
year. The Audit and Risk Committee assists the Board in
discharging its review responsibilities.
The main features of the internal control with respect
to financial reporting, implemented throughout the
year are:
• segregation of duties between the preparation of
valuations and recording into accounting records;
• reviews of valuations are carried out by the
Valuation Committee and reviews of financial
reports are carried out by the Senior Finance
personnel and the Operations Partner of Albion
Capital Group LLP;
• independent third party valuations of the
majority of the asset-based investments within
the portfolio are undertaken annually;
• bank reconciliations are carried out monthly by
the Manager;
• all published financial reports are reviewed by the
Manager’s Compliance department;
• the Board reviews financial information; and
• a separate Audit and Risk Committee of
the Company reviews financial information
(including valuations) to be published.
During the year, as the Board has delegated the
investment management and administration to Albion
Capital Group LLP, the Board feels that it is not necessary
to have its own internal audit function. Instead, the
Board has access to Azets, which, as internal auditor
for Albion Capital Group LLP, undertakes periodic
examination of the business processes and controls
environment at Albion Capital Group LLP, and ensures
that any recommendations to implement improvements
in controls are carried out. During the year, the Audit and
Risk Committee and the Board reviewed internal audit
reports prepared by Azets. The Audit and Risk Committee
Chairman was able to ask specific and detailed questions
of Azets. The Board will continue to monitor its system
of internal control in order to provide assurance that it
operates as intended.
In addition to this, Ocorian Depositary (UK) Limited,
the Company’s external Depositary, provides cash
monitoring, asset verification, and oversight services to
the Company and reports to the Board on a quarterly
basis. The Board and the Audit and Risk Committee will
continue to monitor its system of internal control in
order to provide assurance that it operates as intended.
Conflicts of interest
Directors review the disclosure of conflicts of interest
every six months. In addition, any changes are reviewed
and noted at the beginning of each Board meeting.
A Director who has conflicts of interest refers to an
independent Director to authorise and acknowledge
those conflicts. Procedures to disclose and authorise
conflicts of interest have been adhered to throughout
the year.
Capital structure and Articles of Association
Details regarding the Company’s capital structure,
substantial interests and powers to buy and issue
shares are detailed in full on pages 45 and 50 to 51 of
the Directors’ report. The Company is not party to any
significant agreements that may take effect, alter or
terminate upon a change of control of the Company
following a takeover bid.
Any amendments to the Company’s Articles of
Association are by way of a special resolution subject
to ratification by shareholders.
Relationships with shareholders and other
stakeholders
The Company’s AGM is on 3 September 2024. The AGM
will include a presentation from the Manager on the
portfolio and on the Company, as well as answering
questions that shareholders may have. The AGM will be
held virtually.
Shareholders are also invited to attend the annual
Shareholders’ Seminar. Last year’s event was held
on 15 November 2023, at the Royal College of
Surgeons. The seminar included some of the portfolio
companies sharing insights into their businesses and
presentations 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 usually attend
the seminar. The Board considers this an important
interactive event and invites shareholders to attend this
year’s event scheduled for 20 November 2024 at No. 11
Cavendish Square, London. Further information will be
available nearer the time.
Statement of corporate governance
59Albion Enterprise VCT PLC
Shareholders and financial advisers are able to obtain
information on holdings and performance using the
contact details provided on page 4.
The Company’s share buy-back programme operates
in the market through brokers. In order to sell shares,
as they are quoted on the London Stock Exchange,
investors should approach their broker to undertake
the sale. Banks may be able to assist shareholders with
a referral to a broker within their banking group. More
information on share buy-backs can be found in the
Chairman’s statement on page 12.
Statement of compliance
The Directors consider that the Company has complied
throughout the year ended 31 March 2024 with all
the relevant provisions set out in the AIC Code issued
in 2019. By reporting against the AIC Code, the Board
are meeting their obligations in relation to the 2018
UK Corporate Governance Code (and associated
disclosure requirements under paragraph 9.8.6 of the
Listing Rules). The Directors also consider that they
are complying with their statutory responsibilities and
other regulatory provisions which have a bearing on the
Company.
For and on behalf of the Board
Maxwell Packe
Chairman
11 July 2024
Statement of corporate governance
60 Albion Enterprise VCT PLC
DIRECTORS’ REMUNERATION REPORT
Introduction
This report is submitted in accordance with Section
420 of the Companies Act 2006 and describes how
the Board has applied the principles relating to the
Directors’ remuneration.
An ordinary resolution will be proposed at the AGM of
the Company to be held on 3 September 2024 for the
approval of the Annual Directors’ Remuneration Report
as set out below.
The current Remuneration Policy was approved by
shareholders (of shareholders who cast their vote,
96.8% voted for the resolution, 3.2% against the
resolution and of the total votes cast, 208,433, being
0.2% of total voting rights, were withheld) at the AGM
held on 30 August 2023. It will remain in place for a
three year period, and it will next be put to shareholders
at the 2026 AGM.
The Company’s independent Auditor, Johnston
Carmichael LLP, is required to give its opinion on certain
information included in this report, as indicated below.
The Auditor’s opinion is included in the Independent
Auditor’s Report.
Annual statement from the Chairman of the
Remuneration Committee
The Remuneration Committee comprises all Directors,
except Patrick Reeve, with Christopher Burrows as
Chairman.
The Remuneration Committee met after the year
end to review Directors’ responsibilities and fees and
concluded that the current levels of remuneration,
which were last increased in April 2023, of £31,000
for the Chairman, £29,000 for the Audit and Risk
Committee chairman and £26,000 for non-executive
Directors, (save for Patrick Reeve who continued to
waive his fees), remained appropriate and so proposed
no increase for the forthcoming year. This is in line with
the expectation made in the prior year that, having
rebased the remuneration to be in line with the market,
it will now be reviewed every three years thereafter,
at the same time as considering and approving the
Company’s remuneration policy.
Directors’ remuneration policy
The Company’s policy is that fees payable to non-
executive Directors should reflect their expertise,
responsibilities and time spent on Company matters. In
determining the level of non-executive remuneration,
market equivalents are considered in comparison to the
overall activities and size of the Company. There is no
performance related pay criteria applicable to non-
executive Directors.
The maximum level of non-executive Directors’
remuneration is fixed by the Company’s Articles of
Association, not to exceed £125,000 per annum.
To provide extra flexibility over the coming years, it
is intended that the limit of non-executive Directors’
remuneration is increased so as to not exceed
£150,000 per annum in aggregate. The amendment
will be proposed as an ordinary resolution at the
forthcoming Annual General Meeting. Details regarding
the proposed changes can be seen on page 50, of the
Directors’ report.
The AIC Code requires that all Directors submit
themselves for re-election annually, therefore in
accordance with the AIC Code, Christopher Burrows,
Philippa Latham, Patrick Reeve and Rhodri Whitlock
will offer themselves for re-election at the forthcoming
AGM. Maxwell Packe will retire as a Director on 3
September 2024 and is not being put forward for re-
election accordingly.
None of the Directors have a service contract with
the Company, and as such there is no policy on
termination payments. There is no notice period and
no payments for loss of office were made during the
period. On being appointed to the Board, Directors
receive a letter from the Company setting out the
terms of their appointment and their specific duties
and responsibilities, which are kept at the Manager’s
registered address. The Company is managed by Albion
Capital Group LLP and has no employees. The Board
consists solely of non-executive Directors, who are
considered key management personnel.
Shareholders’ views in respect of Directors’
remuneration are regarded highly and the Board
GOVERNANCE
61Albion Enterprise VCT PLC
Directors’ remuneration report
encourages shareholders to communicate their
thoughts to the Board, which it takes into account
where appropriate when formulating its policy. At the
last AGM, 96.9% of shareholders who voted, voted for
the resolution approving the Directors’ remuneration
report, 3.1% voted against the resolution and of the
total votes cast, 124,617 were withheld, which shows
significant shareholder support.
Annual report on remuneration
The remuneration of individual Directors’ is determined
by the Remuneration Committee within the framework
set by the Board. The Committee meets at least once
a year and met once during the year under review with
full attendance from all of its members.
The Board is responsible for reviewing the
remuneration of the Directors and the Company’s
remuneration policy to ensure that it reflects the
duties, responsibilities and value of time spent by the
Directors on the business of the Company and makes
recommendations to the Board accordingly.
Directors’ remuneration
The total figure for Directors’ remuneration and a table
of Directors’ interests below have been audited.
The following tables below show an analysis of the
remuneration, excluding National Insurance, of individual
Directors who served during the last four years:
Total Directors’ remuneration (audited)
Year ended
31 March 2024
Year ended
31 March 2023
£’000 £’000
Maxwell Packe 31.0 27.5
Christopher Burrows 26.0 23.5
Philippa Latham 26.0 23.5
Patrick Reeve - -
Rhodri Whitlock 29.0 25.5
112.0 100.0
Annual percentage change in Directors’ remuneration (audited)
Percentage change
2023 to 2024
Percentage change
2022 to 2023
Percentage change
2021 to 2022
Percentage change
2020 to 2021
% % % %
Maxwell Packe 13 15 - -
Lord St. John of Bletso
(resigned 30 November 2020)
N/A N/A N/A (35)
The Dowager Lady Balfour of Burleigh
(resigned 12 August 2021)
N/A N/A (64) -
Christopher Burrows 11 7 - -
Philippa Latham
(appointed 1 September 2021)
11 81 N/A N/A
Patrick Reeve - - - -
Rhodri Whitlock
(appointed 19 January 2021)
14 11 360 N/A
Total overall change 12 11 2 2
62 Albion Enterprise VCT PLC
Directors’ remuneration report
The following items have not been audited.
Albion Capital Group LLP, its partners and staff,
including Patrick Reeve, hold 883,138 Ordinary shares
in the Company as at 31 March 2024.
Performance graph
The graph that follows on page 64 shows the
Company’s Ordinary share price total return against the
FTSE All-Share Index total return, in both instances with
dividends reinvested, since 1 April 2014. The Directors
consider the FTSE All-Share Index to be the most
appropriate benchmark for the Company as it contains
a large range of sectors within the UK economy.
Investors should, however, be reminded that shares in
VCTs generally trade at a discount to the actual net
asset value of the Company.
There are no options, issued or exercisable, in
the Company which would distort the graphical
representation.
The base remuneration of each of the Directors’
positions increased during the year, effective from 1
April 2023.
The Directors’ remuneration for the year ending 31
March 2025 is expected to be approximately £106,000.
In addition to Directors’ remuneration, the Company pays
an annual premium in respect of Directors’ & Officers’
Liability Insurance of £33,000 (2023: £31,000). The
Company does not confer any share options, long term
incentives or retirement benefits to any Director, nor does
it make a contribution to any pension scheme on behalf
of the Directors. Each Director of the Company was
remunerated personally through the Manager’s payroll
which has been recharged to the Company.
Directors’ interests (audited)
The Directors and their interests in the shares of the
Company (together with those of their immediate
family) are shown below.
There are no guidelines or requirements in respect of
Directors’ share holdings.
Directors’ interests
Shares held on
31 March 2024
Shares held on
31 March 2023
Maxwell Packe 617,700 582,735
Christopher Burrows 259,936 228,856
Philippa Latham 38,547 26,892
Patrick Reeve 97,639 97,639
Rhodri Whitlock 29,661 22,348
1,043,483 958,470
63
Directors’ remuneration report
Directors’ pay compared to distribution to shareholders
2024
£’000
2023
£’000
Percentage change from
2023 to 2024
Total dividend distribution to shareholders 6,306 5,951 6%
Share buybacks 2,450 2,879 (15)%
Total Directors’ fees 112 100 12%
Methodology: The share price return to the shareholder, including original amount invested (rebased to 100) from 1 April 2014, assuming that
dividends were re-invested at the share price of the Company at the time the shares were quoted ex-dividend. Transaction costs are not taken
into account.
250
200
150
100
50
For and on behalf of the Board
Maxwell Packe
Chairman
11 July 2024
Share price total return relative to FTSE All-Share Index total return
(in both cases with dividends reinvested)
Apr
2014
Mar
2015
Mar
2016
Mar
2017
Mar
2018
Mar
2019
Mar
2020
Mar
2021
Mar
2022
Mar
2023
Mar
2024
Share price total return
FTSE All-Share Index total return
Return (pence per share)
64 Albion Enterprise VCT PLC
65Albion Enterprise VCT PLC
GOVERNANCE
INDEPENDENT AUDITOR’S REPORT TO THE
MEMBERS OF ALBION ENTERPRISE VCT PLC
Opinion
We have audited the Financial Statements of Albion
Enterprise VCT PLC (“the Company”), for the year
ended 31 March 2024, which comprise the Income
Statement, the Balance sheet, the Statement of
changes in equity, the Statement of cash flows, and the
notes to the Financial Statements, including significant
accounting policies.
The financial reporting framework that has been
applied in their preparation is applicable law and
United Kingdom Accounting Standards, including
Financial Reporting Standard 102 The Financial
Reporting Standard applicable in the UK and Republic
of Ireland (United Kingdom Generally Accepted
Accounting Practice).
In our opinion the Financial Statements:
• give a true and fair view of the state of the
Company’s affairs as at 31 March 2024 and of
its profit for the year then ended;
• have been properly prepared in accordance with
United Kingdom Generally Accepted Accounting
Practice; and
• have been prepared in accordance with the
requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with
International Standards on Auditing (UK) (ISAs
(UK)) and applicable law. Our responsibilities
under those standards are further described in the
Auditor’s responsibilities for the audit of the Financial
Statements section of our report.
We are independent of the Company in accordance
with the ethical requirements that are relevant to our
audit of the Financial Statements in the UK, including
the FRC’s Ethical Standard, as applied to listed public
interest entities, and we have fulfilled our other ethical
responsibilities in accordance with these requirements.
We believe that the audit evidence we have obtained
is sufficient and appropriate to provide a basis for our
opinion.
Our approach to the audit
We planned our audit by first obtaining an
understanding of the Company and its environment,
including its key activities delegated by the Board to
relevant approved third-party service providers and the
controls over provision of those services.
We conducted our audit using information maintained
and provided by Albion Capital Group LLP (the
“Investment Manager”, the “Company Secretary”, and
“Administrator”) Ocorian Depositary (UK) Limited (the
“Depositary”) and Computershare Investor Services PLC
(the “Registrar”) to whom the Company has delegated
the provision of services.
We tailored the scope of our audit to reflect our risk
assessment, taking into account such factors as
the types of investments within the Company, the
involvement of the Administrator, the accounting
processes and controls, and the industry in which the
Company operates.
The scope of our audit was influenced by our
application of materiality. We set certain quantitative
thresholds for materiality. These together with
qualitative considerations, helped us to determine
the scope of our audit and the nature, timing and
extent of our audit procedures on the individual
Financial Statement line items and disclosures and
in the evaluation of the effect of misstatements,
both individually and in aggregate on the Financial
Statements as a whole.
Key audit matters
Key audit matters are those matters that, in our
professional judgement, were of most significance in
our audit of the Financial Statements of the current
period and include the most significant assessed risks
66 Albion Enterprise VCT PLC
of material misstatement (whether or not due to fraud) that we identified. These matters included those which had
the greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of
the engagement team. These matters were addressed in the context of our audit of the Financial Statements as a
whole, and in forming our opinion thereon, we do not provide a separate opinion on these matters.
We summarise below the key audit matter in arriving at our audit opinion above, together with how our audit
addressed this matter and the results of our audit work in relation to this matter.
Key audit matter How our audit addressed the key audit matter and our conclusions
Valuation of level 3 investments
(as per page 57 (Audit and Risk Committee
Report), pages 77 and 78 (Accounting Policies)
and Note 11.
The valuation of the level 3 portfolio at 31
March 2024 was £105.41m (2023 £95.37m).
As this is the largest component of the
Company’s Balance sheet, and there is a high
degree of estimation and subjectivity in the
valuation of level 3 investments, it has been
designated as a key audit matter, being one of
the most significant assessed risks of material
misstatements due to fraud or error.
The level 3 investments are valued in accordance
with the revised International Private Equity
and Venture Capital (IPEV) valuation guidelines.
Significant judgement is required in applying
these principles and determining certain inputs
to the valuation models.
We have performed a walkthrough of the level 3 investment valuation
process to evaluate the design of the process and implementation of key
controls.
We obtained evidence that the Manager’s Valuation Committee review
and approve the valuation of the level 3 investments.
We obtained evidence of the Board’s review and approval of the valuation
of the level 3 investments.
We stratified the portfolio of level 3 investments according to risk,
considering the value of individual investments, the movement in fair value
and the inherent risk factors associated with each valuation basis. We
then selected a sample of investments for testing, to ensure appropriate
coverage of each strata of the portfolio.
For the sample of level 3 investments, we:
• Obtained an understanding of the sector for each investee company for
the period being audited, making enquiries of management.
• Assessed the degree to which the valuations are subject to estimation
uncertainty and the degree to which the selection and application of the
valuation method, assumptions and data are affected by complexity and
subjectivity, to understand the specific risks of each valuation.
• Based on the specific risks identified, for certain investments in our
sample, we engaged our specialist corporate finance team, to challenge
the appropriateness of certain judgements, such as multiples and
discounts.
• Corroborated data used in the valuation models to independent sources,
assessing if market conditions meet management’s expectations and
any forecasts used in the valuation models are suitable, consistent and
the data is relevant and reliable, including considering any contradictory
data identified.
• Reperformed the calculation of the valuation models to ensure
mathematical accuracy.
• Assessed whether the valuation methodologies were in line with the
accounting policies, FRS 102 and IPEV guidelines.
• Where appropriate based on the valuation methodology applied, we
developed an auditor’s point estimate or range.
We performed back-testing over investment disposals (proceeds vs most
recent valuation) to assess for potential management bias in the valuation
process.
From our completion of these procedures, we identified no material
misstatements in relation to the valuation of the level 3 investments.
Independent Auditor’s report to the members of Albion Enterprise VCT PLC
67Albion Enterprise VCT PLC
Independent Auditor’s report to the members of Albion Enterprise VCT PLC
Our application of materiality
We define materiality as the magnitude of misstatement in the Financial Statements that makes it probable that
the economic decisions of a reasonably knowledgeable person would be changed or influenced. We use materiality
in determining the nature and extent of our work and in evaluating the results of that work.
Materiality measure Value
Materiality for the Financial Statements as a whole – we have set materiality as 2% of net assets as
we believe that net assets is the primary performance measure used by investors and is the key driver of
shareholder value. We determined the measurement percentage to be commensurate with the risk and
complexity of the audit and the Company’s listed status.
£2.81m
Performance materiality – performance materiality represents amounts set by the auditor at less than
materiality for the Financial Statements as a whole, to reduce to an appropriately low level the probability
that the aggregate of uncorrected and undetected misstatements exceeds materiality for the Financial
Statements as a whole.
In setting this we consider the Company’s overall control environment and any experience of the audit that
indicates a lower risk of material misstatements. Based on our judgements of these factors we have set
performance materiality at 50% of our overall Financial Statement materiality as this is our first year as
auditor.
£1.41m
Specific materiality – recognising that there are transactions and balances of a lesser amount which could
influence the understanding of users of the Financial Statements we calculate a lower level of materiality for
testing such areas.
Specifically, given the importance of the distinction between revenue and capital for the Company, we applied
a separate testing threshold for the revenue column of the income statement set at the higher of 5% of the
revenue profit on ordinary activities before taxation and our Audit and Risk Committee reporting threshold.
We have also set a separate materiality in respect of related party transactions and Directors’ remuneration.
We used our judgement in setting these thresholds and considered our experience and industry benchmarks
for specific materiality.
£0.14m
Audit and Risk Committee reporting threshold – we agreed with the Audit and Risk Committee that we
would report to them all differences in excess of 5% of overall materiality in addition to other identified
misstatements that warranted reporting on qualitative grounds, in our view. For example, an immaterial
misstatement as a result of fraud.
£0.14m
During the course of the audit, we reassessed initial materiality and found no reason to alter the basis of
calculation used at year-end.
Conclusions relating to going concern
In auditing the Financial Statements, we have concluded that the Directors’ use of the going concern basis
of accounting in the preparation of the Financial Statements is appropriate. Our evaluation of the Directors’
assessment of the Company’s ability to continue to adopt the going concern basis of accounting included:
• Evaluating management’s method of assessing going concern, including consideration of market conditions
and uncertainties;
• Assessing and challenging the forecast cashflows and associated sensitivity modelling used by the Directors
in support of their going concern assessment;
• Obtaining and recalculating management’s assessment of the Company’s ongoing maintenance of venture
capital trust status; and
• Assessing the adequacy of the Company’s going concern disclosures included in the Annual Report.
Based on the work we have performed, we have not identified any material uncertainties relating to events or
conditions that, individually or collectively, may cast significant doubt on the Company’s ability to continue as a
going concern for a period of at least twelve months from when the Financial Statements are authorised for issue.
68 Albion Enterprise VCT PLC
In relation to the Company’s reporting on how it has
applied the UK Corporate Governance Code, we have
nothing material to add or draw attention to in relation
to the Directors’ statement in the Financial Statements
about whether the Directors considered it appropriate
to adopt the going concern basis of accounting.
Our responsibilities and the responsibilities of the
Directors with respect to going concern are described in
the relevant sections of this report.
Other information
The other information comprises the information
included in the Annual Report other than the Financial
Statements and our auditor’s report thereon. The
Directors are responsible for the other information
contained within the Annual Report. Our opinion on
the Financial Statements does not cover the other
information and, except to the extent otherwise
explicitly stated in our report, we do not express any
form of assurance conclusion thereon.
Our responsibility is to read the other information and,
in doing so, consider whether the other information is
materially inconsistent with the Financial Statements
or our knowledge obtained in the course of the audit,
or otherwise appears to be materially misstated. If
we identify such material inconsistencies or apparent
material misstatements, we are required to determine
whether this gives rise to a material misstatement in
the Financial Statements themselves. If, based on the
work we have performed, we conclude that there is a
material misstatement of this other information, we are
required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the
Companies Act 2006
In our opinion, the part of the Directors’ Remuneration
Report to be audited has been properly prepared in
accordance with the Companies Act 2006.
In our opinion, based on the work undertaken in the
course of the audit:
• The information given in the Strategic Report and
the Directors’ Report for the financial year for
which the Financial Statements are prepared is
consistent with the Financial Statements; and
Independent Auditor’s report to the members of Albion Enterprise VCT PLC
• The Strategic Report and the Directors’ Report
have been prepared in accordance with
applicable legal requirements.
Matters on which we are required to report
by exception
In the light of the knowledge and understanding of
the Company and its environment obtained in the
course of the audit, we have not identified material
misstatements in the Strategic Report or the Directors’
Report.
We have nothing to report in respect of the following
matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:
• Adequate accounting records have not been kept
by the Company, or returns adequate for our
audit have not been received from branches not
visited by us; or
• The Financial Statements and the part of the
Directors’ Remuneration Report to be audited are
not in agreement with the accounting records
and returns; or
• Certain disclosures of Directors’ remuneration
specified by law are not made; or
• We have not received all the information and
explanations we require for our audit; or
• A corporate governance statement has not been
prepared by the Company.
Corporate governance statement
The Listing Rules require us to review the Directors’
statement in relation to going concern, longer-term
viability and that part of the Corporate Governance
Statement relating to the Company’s compliance with
the provisions of the UK Corporate Governance Code
specified for our review.
Based on the work undertaken as part of our audit, we
have concluded that each of the following elements
of the Corporate Governance Statement is materially
consistent with the Financial Statements or our
knowledge obtained during the audit:
• The Directors’ statement with regards to
the appropriateness of adopting the going
concern basis of accounting and any material
uncertainties identified set out on page 46;
69
• The Directors’ explanation as to its assessment
of the Company’s prospects, the period this
assessment covers and why the period is
appropriate set out on page 26;
• The Directors’ statement on whether it has a
reasonable expectation that the Company will
be able to continue in operation and meet its
liabilities set out on page 26;
• The Directors’ statement on fair, balanced and
understandable set out on page 52;
• The Board’s confirmation that it has carried out a
robust assessment of the emerging and principal
risks set out on page 22;
• The section of the annual report that describes
the review of the effectiveness of risk
management and internal control systems set
out on pages 58 to 59; and
• The section describing the work of the Audit and
Risk Committee set out on pages 55 to 58.
Responsibilities of Directors
As explained more fully in the Directors’ responsibilities
statement set out on page 52, the Directors are
responsible for the preparation of the Financial
Statements and for being satisfied that they give a
true and fair view, and for such internal control as
the Directors determine is necessary to enable the
preparation of Financial Statements that are free from
material misstatement, whether due to fraud or error.
In preparing the Financial Statements, the Directors
are responsible for assessing the Company’s ability to
continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going
Independent Auditor’s report to the members of Albion Enterprise VCT PLC
concern basis of accounting unless the Directors either
intend to liquidate the Company or to cease operations,
or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the
Financial Statements
Our objectives are to obtain reasonable assurance
about whether the Financial Statements as a whole
are free from material misstatement, whether due
to fraud or error, and to issue an auditor’s report
that includes our opinion. Reasonable assurance is
a high level of assurance but is not a guarantee that
an audit conducted in accordance with ISAs (UK) will
always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate,
they could reasonably be expected to influence the
economic decisions of users taken on the basis of these
Financial Statements.
A further description of our responsibilities for the audit
of the Financial Statements is located on the Financial
Reporting Council’s website at: http://www.frc.org.uk/
auditorsresponsibilities. This description forms part of
our auditor’s report.
Extent the audit was considered capable of
detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-
compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined
above, to detect material misstatements in respect
of irregularities, including fraud. The extent to which
70 Albion Enterprise VCT PLC
our procedures are capable of detecting irregularities,
including fraud is detailed below.
We assessed whether the engagement team
collectively had the appropriate competence and
capabilities to identify or recognise non-compliance
with laws and regulations by considering their
experience, past performance and support available.
All engagement team members were briefed on
relevant identified laws and regulations and potential
fraud risks at the planning stage of the audit.
Engagement team members were reminded to remain
alert to any indications of fraud or non-compliance with
laws and regulations throughout the audit.
We obtained an understanding of the legal and
regulatory frameworks that are applicable to the
Company and the sector in which it operates, focusing
on those provisions that had a direct effect on the
determination of material amounts and disclosures
in the Financial Statements. The most relevant
frameworks we identified include:
• Companies Act 2006;
• FCA listing and DTR rules;
• The principles of the UK Corporate Governance
Code applied by the AIC Code of Corporate
Governance (the “AIC Code”);
• Industry practice represented by the Statement
of Recommended Practice: Financial Statements
of Investment Trust Companies and Venture
Capital Trusts (“the SORP”);
• Financial Reporting Standard 102; and
• The Company’s qualification as a Venture Capital
Trust under section 274 of the Income Tax Act
2007.
We gained an understanding of how the Company is
complying with these laws and regulations by making
enquiries of management and those charged with
governance. We corroborated these enquiries through
our review of relevant correspondence with regulatory
bodies and board meeting minutes.
We assessed the susceptibility of the Company’s
Financial Statements to material misstatement,
including how fraud might occur, by meeting with
management and those charged with governance
to understand where it was considered there was
susceptibility to fraud. This evaluation also considered
how management and those charged with governance
Independent Auditor’s report to the members of Albion Enterprise VCT PLC
were remunerated and whether this provided an
incentive for fraudulent activity. We considered the
overall control environment and how management
and those charged with governance oversee the
implementation and operation of controls. We
identified a heightened fraud risk in relation to the
valuation of level 3 investments (audit procedures
performed in response to this risk are set out in the
section on key audit matters above) and management
override of controls (procedures performed in response
to this risk are set out below).
In addition to the above, the following procedures were
performed to provide reasonable assurance that the
Financial Statements were free of material fraud or
error:
• Reviewing minutes of meetings of those charged
with governance for reference to: breaches of
laws and regulation or for any indication of
any potential litigation and claims; and events
or conditions that could indicate an incentive
to commit fraud or provide an opportunity to
commit fraud;
• Performing audit work procedures over the risk
of management override of controls, including
unpredictability testing, testing of journal entries
and other adjustments for appropriateness,
recalculating the investment management
and performance incentive fees, evaluating the
business rationale of significant transactions
outside the course of normal business and
reviewing judgements made by management
in their calculation of accounting estimates for
potential management bias;
• Completion of appropriate checklists and use
of our experience to assess the Company’s
compliance with the Companies Act 2006 and
the Listing Rules; and
• Agreement of the Financial Statement
disclosures to supporting documentation.
Our audit procedures were designed to respond to
the risk of material misstatements in the Financial
Statements, recognising that the risk of not detecting a
material misstatement due to fraud is higher than the
risk of not detecting one resulting from error, as fraud
may involve intentional concealment, forgery, collusion,
omission or misrepresentation. There are inherent
limitations in the audit procedures described above
and the further removed non-compliance with laws
71Albion Enterprise VCT PLC
and regulations is from the events and transactions
reflected in the Financial Statements, the less likely we
would become aware of it.
Other matters which we are required to
address
Following the recommendation of the Audit and
Risk Committee, we were appointed by the Board on
30 October 2023 to audit the Financial Statements
for the year ended 31 March 2024 and subsequent
financial periods. The period of our total uninterrupted
engagement is one year, covering the year ended 31
March 2024.
The non-audit services prohibited by the FRC’s Ethical
Standard were not provided to the Company and we
remain independent of the Company in conducting
our audit.
Our audit opinion is consistent with the additional
report to the Audit and Risk Committee.
Independent Auditor’s report to the members of Albion Enterprise VCT PLC
Use of our report
This report is made solely to the Company’s members,
as a body, in accordance with Chapter 3 of Part 16
of the Companies Act 2006. Our audit work has been
undertaken so that we might state to the Company’s
members those matters we are required to state to
them in an auditor’s report and for no other purpose.
To the fullest extent permitted by law, we do not accept
or assume responsibility to anyone other than the
Company and the Company’s members as a body, for
our audit work, for this report, or for the opinions we
have formed.
Bryan Shepka (Senior Statutory Auditor)
For and on behalf of Johnston Carmichael LLP
Statutory Auditor
Edinburgh, United Kingdom
11 July 2024
Company
information
and Financials
Year ended 31 March 2024 Year ended 31 March 2023
Revenue Capital Total Revenue Capital Total
Note £’000 £’000 £’000 £’000 £’000 £’000
Net gains on investments 3 - 4,883 4,883 - 4,535 4,535
Investment income 4 1,697 - 1,697 1,206 - 1,206
Investment Manager’s fees 5 (256) (2,307) (2,563) (236) (2,121) (2,357)
Other expenses 6 (683) - (683) (618) - (618)
Profit on ordinary activities before tax 758 2,576 3,334 352 2,414 2,766
Tax on ordinary activities 8 - - - - - -
Profit and total comprehensive income
attributable to shareholders 758 2,576 3,334 352 2,414 2,766
Basic and diluted return per share (pence)* 10 0.75 2.55 3.30 0.39 2.64 3.03
* adjusted for treasury shares
The accompanying notes on pages 77 to 91 form an integral part of these Financial Statements.
The total column of this Income statement represents the profit and loss account of the Company. The
supplementary revenue and capital columns have been prepared in accordance with The Association of Investment
Companies Statement of Recommended Practice.
All gains and losses are recognised in the Income statement and all items in the above statement are derived from
continuing operations.
73
INCOME STATEMENT
INFORMATION
& FINANCIALS
BALANCE SHEET
INFORMATION
& FINANCIALS
Note
31 March 2024
£’000
31 March 2023
£’000
Fixed asset investments 11 105,513 95,798
Current assets
Trade and other receivables 13 176 2,561
Cash in bank and in hand 36,314 32,860
36,490 35,421
Payables: amounts falling due within one year
Trade and other payables 14 (1,355) (1,489)
Net current assets 35,135 33,932
Total assets less current liabilities 140,648 129,730
Equity attributable to equity holders
Called-up share capital 15 1,284 1,154
Share premium 41,730 25,520
Unrealised capital reserve 48,179 41,735
Realised capital reserve 7,017 10,885
Other distributable reserve 42,438 50,436
Total equity shareholders’ funds 140,648 129,730
Basic and diluted net asset value per share (pence) * 16 125.77 128.60
* excluding treasury shares
The accompanying notes on pages 77 to 91 form an integral part of these Financial Statements.
These Financial Statements were approved by the Board of Directors, and authorised for issue on 11 July 2024 and
were signed on its behalf by
Maxwell Packe
Chairman
Company number: 05990732
74 Albion Enterprise VCT PLC
STATEMENT OF CHANGES IN EQUITY
INFORMATION
& FINANCIALS
Called-up
share
capital
£’000
Share
premium
£’000
Unrealised
capital
reserve
£’000
Realised
capital
reserve*
£’000
Other
distributable
reserve*
£’000
Total
£’000
On 1 April 2023 1,154 25,520 41,735 10,885 50,436 129,730
Profit/(loss) and total
comprehensive income for
the year - - 5,053 (2,477) 758 3,334
Transfer of unrealised
losses on disposal of
investments - - 1,391 (1,391) - -
Purchase of shares for
treasury - - - - (2,450) (2,450)
Issue of equity 130 16,699 - - - 16,829
Cost of issue of equity - (489) - - - (489)
Dividends paid - - - - (6,306) (6,306)
On 31 March 2024 1,284 41,730 48,179 7,017 42,438 140,648
On 1 April 2022 1,017 8,278 32,790 17,416 58,914 118,415
Profit/(loss) and total
comprehensive income for
the year - - 4,805 (2,391) 352 2,766
Transfer of unrealised
losses on disposal of
investments - - 4,140 (4,140) - -
Purchase of shares for
treasury - - - - (2,879) (2,879)
Issue of equity 137 17,680 - - - 17,817
Cost of issue of equity - (438) - - - (438)
Dividends paid - - - - (5,951) (5,951)
On 31 March 2023 1,154 25,520 41,735 10,885 50,436 129,730
* Included within these reserves are amounts of £24,459,000 (2023: £22,964,000) which are considered distributable. Over the next two years
an additional £21,891,000 will become distributable. This is due to the HMRC requirement that the Company cannot use capital raised in the
past three years to make a payment or distribution to shareholders. On 1 April 2024, £9,075,000 became distributable in line with this.
The accompanying notes on pages 77 to 91 form an integral part of these Financial Statements.
The nature of each reserve is described in note 2 on pages 78 and 79.
75Albion Enterprise VCT PLC
STATEMENT OF CASH FLOWS
INFORMATION
& FINANCIALS
Year ended
31 March 2024
£’000
Year ended
31 March 2023
£’000
Cash flow from operating activities
Loan stock income received 846 641
Deposit interest received 440 82
Income from fixed term funds received 324 102
Dividend income received 227 152
Investment Manager’s fees paid (2,499) (4,233)
Other cash payments (703) (626)
Corporation tax paid - -
Net cash flow used in operating activities (1,365) (3,882)
Cash flow from investing activities
Purchase of fixed asset investments* (8,862) (12,455)
Proceeds from disposals of fixed asset investments* 6,283 2,088
Net cash flow used in investing activities (2,579) (10,367)
Cash flow from financing activities
Issue of share capital 15,368 24,753
Cost of issue of equity** (40) (53)
Equity dividends paid (net of Dividend Reinvestment Scheme) (5,298) (4,945)
Purchase of own shares (2,632) (2,198)
Net cash flow from financing activities 7,398 17,557
Increase in cash in bank and in hand 3,454 3,308
Cash in bank and in hand at start of period 32,860 29,552
Cash in bank and in hand at end of period 36,314 32,860
* Purchases and disposals detailed above do not agree to note 11 due to restructuring of investments, conversion of convertible loan stock and
settlement of receivables and payables.
** The cost of issue of equity does not agree to the Statement of changes in equity due to prospectus fundraising amounts being received net of fees.
The accompanying notes on pages 77 to 91 form an integral part of these Financial Statements.
76 Albion Enterprise VCT PLC
1. Accounting convention
The Financial Statements have been prepared in
accordance with applicable United Kingdom law and
accounting standards, including Financial Reporting
Standard 102 (“FRS 102”), and with the Statement
of Recommended Practice “Financial Statements of
Investment Trust Companies and Venture Capital Trusts”
(“SORP”) issued by The Association of Investment
Companies (“AIC”). The Financial Statements have been
prepared on a going concern basis and further details can
be found in the Directors’ report on page 46.
The preparation of the Financial Statements requires
management to make judgements and estimates
that affect the application of policies and reported
amounts of assets, liabilities, income and expenses. The
most critical estimates and judgements relate to the
determination of carrying value of investments at Fair
Value Through Profit and Loss (“FVTPL”) in accordance
with FRS 102 sections 11 and 12. The Company
values investments by following the International
Private Equity and Venture Capital Valuation (“IPEV”)
Guidelines as updated in 2022 and further detail on the
valuation techniques used are outlined in note 2 below.
Company information is shown on page 4.
2. Accounting policies
Fixed asset investments
The Company’s business is investing in financial assets
with a view to profiting from their total return in the form
of income and capital growth. This portfolio of financial
assets is managed and its performance evaluated on
a fair value basis, in accordance with a documented
investment policy, and information about the portfolio is
provided internally on that basis to the Board.
In accordance with the requirements of FRS 102, those
undertakings in which the Company holds more than
20% of the equity as part of an investment portfolio are
not accounted for using the equity method. In these
circumstances the investment is measured at FVTPL.
Upon initial recognition (using trade date accounting)
investments, including loan stock, are classified by the
Company as FVTPL and are included at their initial
fair value, which is cost (excluding expenses incidental
to the acquisition which are written off to the Income
statement).
Subsequently, the investments are valued at ‘fair value’,
which is measured as follows:
• Investments listed on recognised exchanges
are valued at their bid prices at the end of the
accounting period or otherwise at fair value
based on published price quotations.
• Unquoted investments, where there is not an
active market, are valued using an appropriate
valuation technique in accordance with the IPEV
Guidelines. Indicators of fair value are derived
using established methodologies including
earnings multiples, revenue multiples, the level of
third party offers received, cost or price of recent
investment rounds, net assets, discounted cash
flows and industry valuation benchmarks. Where
price of recent investment is used as a starting
point for estimating fair value at subsequent
measurement dates, this has been benchmarked
using an appropriate valuation technique
permitted by the IPEV guidelines.
• In situations where cost or price of recent
investment is used, consideration is given to
the circumstances of the portfolio company
since that date in determining fair value. This
includes consideration of whether there is any
evidence of deterioration or strong definable
evidence of an increase in value. In the absence
of these indicators, other valuation techniques
are employed to conclude on the fair value as at
the measurement date. Examples of events or
changes that could indicate a diminution include:
– the performance and/or prospects of the
underlying business are significantly below
the expectations on which the investment was
based; or
– a significant adverse change either in the
portfolio company’s business or in the
technological, market, economic, legal or
regulatory environment in which the business
operates; or
NOTES TO THE FINANCIAL STATEMENTS
INFORMATION
& FINANCIALS
77Albion Enterprise VCT PLC
– market conditions have deteriorated, which
may be indicated by a fall in the share prices
of quoted businesses operating in the same or
related sectors.
Investments are recognised as financial assets on
legal completion of the investment contract and are
de-recognised on legal completion of the sale of an
investment.
Dividend income is not recognised as part of the fair
value movement of an investment but is recognised
separately as investment income through the other
distributable reserve when a share becomes ex-dividend.
Current assets and payables
Receivables, payables and cash are carried at
amortised cost, in accordance with FRS 102. Deferred
consideration meets the definition of a financing
transaction held at amortised cost, and interest will be
recognised through capital over the credit period using
the effective interest method. There are no financial
liabilities other than payables.
Investment income
Dividend income
Dividend income is included in revenue when the
investment is quoted ex-dividend.
Unquoted loan stock income
Fixed returns on non-equity shares and debt securities
are recognised when the Company’s right to receive
payment and expect settlement is established. Where
interest is rolled up and/or payable at redemption then
it is recognised as income unless there is reasonable
doubt as to its receipt.
Bank deposit income
Interest income is recognised on an accruals basis
using the rate of interest agreed with the bank.
Fixed term funds income
Income from fixed term funds is recognised on an
accruals basis using the agreed rate of interest.
Investment management fee, performance
incentive fee and other expenses
All expenses have been accounted for on an accruals
basis. Expenses are charged through the other
distributable reserve except the following which are
charged through the realised capital reserve:
• 90% of management fees and 100% of
performance incentive fees, if any, are allocated
to the realised capital reserve.
• Expenses which are incidental to the purchase or
disposal of an investment are charged through
the realised capital reserve.
Taxation
Taxation is applied on a current basis in accordance
with FRS 102. Current tax is tax payable/(refundable)
in respect of the taxable profit/(tax loss) for the current
period or past reporting periods using the tax rates and
laws that have been enacted or substantively enacted
at the financial reporting date. Taxation associated with
capital expenses is applied in accordance with the SORP.
Deferred tax is provided in full on all timing differences
at the reporting date. Timing differences are differences
between taxable profits and total comprehensive income
as stated in the Financial Statements that arise from the
inclusion of income and expenses in tax assessments in
periods different from those in which they are recognised
in the Financial Statements. As a VCT the Company has
an exemption from tax on capital gains. The Company
intends to continue meeting the conditions required to
obtain approval as a VCT for the foreseeable future. The
Company therefore, should have no material deferred tax
timing differences arising in respect of the revaluation
or disposal of investments and the Company has not
provided for any deferred tax.
Reserves
Called-up share capital
This accounts for the nominal value of the Company’s
shares.
Share premium
This accounts for the difference between the price paid
for shares and the nominal value of those shares, less
issue costs and transfers to the other distributable
reserve.
Unrealised capital reserve
Increases and decreases in the valuation of
investments held at the year end against cost are
included in this reserve.
Realised capital reserve
The following are disclosed in this reserve:
• gains and losses compared to cost on the
realisation of investments, or permanent
diminutions in value (including gains
recognised on the realisation of investment
where consideration is deferred that are not
distributable as a matter of law);
Notes to the Financial Statements
78 Albion Enterprise VCT PLC
• finance income in respect of the unwinding of the
discount on deferred consideration that is not
distributable as a matter of law;
• expenses, together with the related taxation
effect, charged in accordance with the above
policies; and
• dividends paid to equity holders where paid out
by capital.
Other distributable reserve
The special reserve, treasury share reserve and the
revenue reserve were combined in 2013 to form a
single reserve named other distributable reserve.
This reserve accounts for movements from the revenue
column of the Income statement, the payment of
dividends, the buy-back of shares, transfers from the
share premium and capital redemption reserve, and
other non-capital realised movements.
Dividends
Dividends by the Company are accounted for when the
liability to make the payment (record date) has been
established.
Unclaimed dividends older than a period of twelve
years from the dividend declaration date are forfeited
and returned to the Company in accordance with the
terms of the Articles of Association.
Segmental reporting
The Directors are of the opinion that the Company is
engaged in a single operating segment of business,
being investment in smaller companies principally
based in the UK.
3. Net gains on investments
Year ended
31 March 2024
£’000
Year ended
31 March 2023
£’000
Unrealised gains on fixed asset investments 5,053 4,805
Realised losses on fixed asset investments (438) (582)
Unwinding of discount on deferred consideration 268 312
4,883 4,535
4. Investment income
Year ended
31 March 2024
£’000
Year ended
31 March 2023
£’000
Loan stock interest 762 750
Bank interest 505 82
Income from fixed term funds 324 102
Dividend income 106 272
1,697 1,206
5. Investment Manager’s fees
Year ended
31 March 2024
£’000
Year ended
31 March 2023
£’000
Investment management fees charged to revenue 256 236
Investment management fees charged to capital 2,307 2,121
2,563 2,357
Notes to the Financial Statements
79Albion Enterprise VCT PLC
Further details of the Management agreement under which the investment management fee and performance
incentive fee are paid is given in the Strategic report on page 18.
During the year, services of a total value of £2,822,000 (2023: £2,595,000) were purchased by the Company from
Albion Capital Group LLP (“Albion”); this includes £2,563,000 (2023: £2,357,000) of management fee and £259,000
(2023: £238,000) of administration fee. There is no performance incentive fee payable in the year (2023: £nil). At
the financial year end, the amount due to Albion in respect of these services disclosed as accruals was £762,000
(2023: £692,000). The total annual running costs of the Company are capped at an amount equal to 2.5% of the
Company’s net assets, with any excess being met by Albion by way of a reduction in management fees. During the
year, the management fee was reduced by £25,000 as a result of this cap (2023: £24,000).
During the year, the Company was not charged by Albion in respect of Patrick Reeve’s services as a Director (2023:
£nil).
Albion, its partners and staff (including Patrick Reeve) held 883,138 Ordinary shares in the Company on 31 March
2024.
Albion is, from time to time, eligible to receive arrangement fees and monitoring fees from portfolio companies.
During the year ended 31 March 2024, fees of £173,000 attributable to the investments of the Company were
received by Albion pursuant to these arrangements (2023: £252,000).
The Company has entered into an offer agreement relating to the Offers with the Company’s investment manager,
Albion, pursuant to which Albion will receive a fee of 3.0% of the gross proceeds of the 2023/24 Offers and out of
which Albion will pay the costs of the Offers, as detailed in the Prospectus.
6. Other expenses
Year ended
31 March 2024
£’000
Year ended
31 March 2023
£’000
Directors’ fees (including NIC) 122 109
Auditor’s remuneration for statutory audit services (excluding VAT) 53 48
Administration fee 259 238
Other administrative expenses 249 223
683 618
7. Directors’ fees
The amounts paid to and on behalf of the Directors during the year are as follows:
Year ended
31 March 2024
£’000
Year ended
31 March 2023
£’000
Directors’ fees 112 100
National insurance 10 9
122 109
The Company’s key management personnel are the non-executive Directors. Further information regarding
Directors’ remuneration can be found in the Directors’ remuneration report on pages 61 to 64.
Notes to the Financial Statements
80 Albion Enterprise VCT PLC
Notes to the Financial Statements
8. Tax on ordinary activities
Year ended
31 March 2024
£’000
Year ended
31 March 2023
£’000
UK corporation tax charge in respect of current year - -
Factors affecting the tax charge:
Year ended
31 March 2024
£’000
Year ended
31 March 2023
£’000
Profit on ordinary activities before taxation 3,334 2,766
Tax charge at the average companies rate of 25%
(2023: 19%) 834 526
Factors affecting the charge:
Non-taxable gains (1,221) (862)
Income not taxable (27) (52)
Excess management expenses carried forward 414 388
- -
Notes
(i) Venture Capital Trusts are not subject to corporation tax on capital gains.
(ii) T ax relief on expenses charged to capital has been determined by allocating tax relief to expenses by reference to the applicable
corporation tax rate and allocating the relief between revenue and capital in accordance with the SORP.
(iii) The Company has excess management expenses of £15,326,000 (2023: £13,671,000) that are available for offset against future profits.
A deferred tax asset of £3,832,000 (2023: £3,418,000) has not been recognised in respect of these losses as they will be recoverable only
to the extent that the Company has sufficient future taxable profits.
9. Dividends
Year ended
31 March 2024
£’000
Year ended
31 March 2023
£’000
First dividend of 3.22p per share paid on 31 August 2023
(31 August 2022 – 3.31p per share) 3,247 2,969
Second dividend of 3.06p per share paid on 29 February 2024
(28 February 2023 – 3.18p per share) 3,062 2,985
Unclaimed dividends (3) (3)
6,306 5,951
Details of the consideration issued under the Dividend Reinvestment Scheme included in the dividends above can
be found in note 15.
In addition to the dividends summarised above, the Board has declared a first dividend for the year ending 31
March 2025 of 3.14 pence per share to be paid on 30 August 2024 to shareholders on the register on 2 August
2024. The total dividend will be approximately £3,523,000.
81Albion Enterprise VCT PLC
Notes to the Financial Statements
10. Basic and diluted return per share
Year ended 31 March 2024 Year ended 31 March 2023
Revenue Capital Total Revenue Capital Total
Profit attributable to equity shares (£’000) 758 2,576 3,334 352 2,414 2,766
Weighted average shares in issue (adjusted for treasury shares) 101,138,059 91,226,939
Return attributable per equity share (pence) 0.75 2.55 3.30 0.39 2.64 3.03
The weighted average number of shares is calculated after adjusting for treasury shares of 16,612,548 (2023:
14,558,366).
There are no convertible instruments, derivatives or contingent share agreements in issue so basic and diluted
return per share are the same.
11. Fixed asset investments
Investments held at fair value through profit or loss
31 March 2024
£’000
31 March 2023
£’000
Unquoted equity and preference shares 93,996 82,583
Unquoted loan stock 11,414 12,785
Quoted equity 103 430
105,513 95,798
31 March 2024
£’000
31 March 2023
£’000
Opening valuation 95,798 80,842
Purchases at cost 9,291 12,455
Disposal proceeds (4,106) (1,831)
Realised losses (438) (582)
Movement in loan stock accrued income (85) 109
Unrealised gains 5,053 4,805
Closing valuation 105,513 95,798
Movement in loan stock accrued income
Opening accumulated loan stock accrued income 168 59
Movement in loan stock accrued income (85) 109
Closing accumulated loan stock accrued income 83 168
Movement in unrealised gains
Opening accumulated unrealised gains 41,735 32,790
Transfer of previously unrealised losses to realised reserve on disposal of investments 1,391 4,140
Movement in unrealised gains 5,053 4,805
Closing accumulated unrealised gains 48,179 41,735
Historic cost basis
Opening book cost 53,895 47,993
Purchases at cost 9,291 12,455
Disposals at cost (5,935) (6,553)
Closing book cost 57,251 53,895
82 Albion Enterprise VCT PLC
Notes to the Financial Statements
Purchases and disposals detailed above do not agree to the Statement of cash flows due to restructuring of
investments, conversion of convertible loan stock and settlement of receivables and payables.
Loan stock accrued income above, represents only the loan stock interest which has been recognised as revenue
on the basis that it is expected to be received in accordance with the accounting policy in note 1. Where loan
stock interest does not meet the note 1 recognition criteria for investment income, it forms part of the investment
valuation where this is supported by the overall valuation of the portfolio company, and is included within the
unrealised gains and losses on investments.
Fixed asset investments are valued at fair value in accordance with the IPEV guidelines as follows:
31 March 2024 31 March 2023
Valuation methodology £’000 £’000
Cost and price of recent investment (calibrated and reviewed for impairment) 46,805 52,243
Revenue multiple 24,800 29,005
Discounted offer price 20,795 -
Discounted cash flow– supported by third party valuation 5,674 6,076
Earnings multiple – supported by third party valuation 4,552 4,703
Earnings multiple 2,703 3,254
Net assets 81 87
105,410 95,368
When using the cost or price of a recent investment in the valuations, the Company looks to re-calibrate this price
at each valuation point by reviewing progress within the investment, comparing against the initial investment
thesis, assessing if there are any significant events, milestones that would indicate the value of the investment
has changed and considering whether a market-based methodology (i.e. using multiples from comparable public
companies) or a discounted cashflow forecast would be more appropriate. The background to the transaction
is also considered when the price of investment may not be an appropriate measure of fair value, for example,
disproportionate dilution of existing investors from a new investor coming on board or the market conditions at the
time of investment no longer being a true reflection of fair value.
The main inputs into the calibration exercise, and for the valuation models using multiples, are revenue, EBITDA
and P/E multiples (based on the most recent revenue, EBITDA or earnings achieved and equivalent corresponding
revenue, EBITDA or earnings multiples of comparable companies), quality of earnings assessments and
comparability difference adjustments. Revenue multiples are often used, rather than EBITDA or earnings, due to the
nature of the Company’s investments, being in growth and technology companies which are not normally expected
to achieve profitability or scale for a number of years. Where an investment has achieved scale and profitability the
Company would normally then expect to switch to using an EBITDA or earnings multiple methodology.
In the calibration exercise and in determining the valuation for the Company’s equity instruments, comparable
trading multiples are used. In accordance with the Company’s policy, appropriate comparable companies based
on industry, size, developmental stage, revenue generation and strategy are determined and a trading multiple
for each comparable company identified is then calculated. The multiple is calculated by dividing the enterprise
value of the comparable group by its revenue, EBITDA or earnings. The trading multiple is then adjusted for
considerations such as illiquidity, marketability and other differences, advantages and disadvantages between the
portfolio company and the comparable public companies based on company specific facts and circumstances.
As part of the valuation process, the majority of the asset backed businesses also have an annual external third
party valuation performed to support the investment managers valuations. The third party valuers are experts in
their fields, and have access to many similar business transactions in those specialty areas, and form part of the
Manager’s fair value assessment.
83Albion Enterprise VCT PLC
Notes to the Financial Statements
Fair value investments had the following movements between valuation methodologies between 31 March 2023
and 31 March 2024:
Change in valuation methodology
(2023 to 2024)
Valuation at
31 March 2024
£’000 Explanatory note
Revenue multiple to discounted offer price 20,795
Offer accepted for portfolio company subject to
customary closing conditions and regulatory approvals
Cost and price of recent investment (calibrated
and reviewed for impairment) to revenue multiple 9,645 More appropriate valuation methodology
Revenue multiple to cost and price of recent
investment (calibrated and reviewed for
impairment) 9 More appropriate valuation methodology
The valuation will be the most appropriate valuation methodology for an investment within its market, with
regard to the financial health of the investment and the IPEV Guidelines. The Directors believe that, within these
parameters, these are the most appropriate methods of valuation as at 31 March 2024.
FRS 102 and the SORP requires the Company to disclose the inputs to the valuation methods applied to its
investments measured at FVTPL in a fair value hierarchy. The table below sets out fair value hierarchy definitions
using FRS102 2A.1.
Fair value hierarchy Definition
Level 1 Unadjusted quoted prices in an active market
Level 2 Inputs to valuations are from observable sources and are directly or indirectly derived from prices
Level 3 Inputs to valuations not based on observable market data
The quoted investment is valued according to Level 1 valuation methods (Arecor Therapeutics PLC shown on
page 28). Unquoted equity, preference shares and loan stock are all valued according to Level 3 valuation methods.
Investments held at fair value through profit or loss (Level 3) had the following movements:
31 March 2024 31 March 2023
£’000 £’000
Opening balance 95,368 79,624
Purchases at cost 9,291 12,455
Disposal proceeds (3,928) (1,430)
Movement in loan stock accrued income (85) 109
Realised losses (375) (403)
Unrealised gains 5,139 5,013
Closing balance 105,410 95,368
The Directors are required to consider the impact of changing one or more of the inputs used as part of the
valuation process to reasonable possible alternative assumptions. 74% of the portfolio of investments, consisting
of equity and loan stock, is based on recent investment price, discounted offer price, net assets and cost and is
therefore not sensitised. For the remainder of the portfolio, the Board has considered the reasonable possible
alternative input assumptions on the valuation of the portfolio and believes that changes to inputs (by adjusting
the earnings and revenue multiples) could lead to a change in the fair value of the portfolio. The Board has
reviewed the Manager’s adjusted inputs for a number of the largest portfolio companies (by value) which covers
13% of the portfolio, as shown in the table below. This has resulted in a total coverage of 87% of all the portfolio of
investments.
84 Albion Enterprise VCT PLC
Notes to the Financial Statements
The main inputs considered for each type of valuation is as follows:
Valuation technique
Portfolio company
sector Input
Base
Case*
Change
in input
Change in
fair value of
investments
(£’000)
Change in
NAV (pence
per share)
Revenue multiple Healthcare (including
digital healthcare)
Revenue
multiple
5.2x +0.5x 634 0.57
-0.5x (634) (0.57)
Earnings multiple – supported
by third party valuation
Other (including
education)
Earnings
multiple
15.9x +1.6x 293 0.26
-1.6x (293) (0.26)
Revenue multiple Software &
technology
Revenue
multiple
7.6x +0.8x 293 0.26
-0.8x (293) (0.26)
*As detailed in the accounting policies on page 77, the base case is based on market comparables, discounted
where appropriate for marketability, in accordance with the IPEV guidelines.
The impact of these changes could result in an overall increase in the valuation of the equity investments by
£1,220,000 (1.1%) or a decrease in the valuation of equity investments by £1,220,000 (1.1%).
12. Significant interests
The principal activity of the Company is to select and hold a portfolio of investments. Although the Company,
through the Manager, will, in some cases, be represented on the Board of the portfolio company, it will not take a
controlling interest or become involved in the management of a portfolio company. The size and structure of the
companies with unquoted securities may result in certain holdings in the portfolio representing a participating
interest without there being any partnership, joint venture or management consortium agreement. The investment
listed below is held as part of an investment portfolio and therefore, as permitted by FRS 102 section 9.9B, it is
measured at FVTPL and not accounted for using the equity method.
The Company has interests of greater than 20% of the nominal value of any class of the allotted shares in the
portfolio company on 31 March 2024 as described below:
Company
Registered
postcode
Profit/(loss)
before tax
£’000
Aggregate
capital and
reserves
£’000
Result for year
ended
% class and
share type
% total voting
rights
Greenenerco
Limited
EC1M 5QL, UK n/a* 307 31 March 2023 28.6% A
Ordinary
28.6%
*Filleted accounts which do not disclose this information.
85Albion Enterprise VCT PLC
Notes to the Financial Statements
13. Current assets
31 March 2024 31 March 2023
Trade and other receivables £’000 £’000
Prepayments and accrued income 98 29
Other receivables 37 306
Deferred consideration under one year 41 2,226
176 2,561
The deferred consideration in the prior year predominantly related to the sale of G. Network Communications
Limited in December 2020. These proceeds were received in January 2024.
The Directors consider that the carrying amount of receivables is not materially different to their fair value.
14. Payables: amounts falling due within one year
31 March 2024 31 March 2023
£’000 £’000
Accruals and deferred income 830 787
Trade payables 525 702
1,355 1,489
The Directors consider that the carrying amount of payables is not materially different to their fair value.
15. Called-up share capital
Allotted, called-up and fully paid shares: £’000
115,435,416 Ordinary shares of 1 penny each at 31 March 2023 1,154
13,007,087 Ordinary shares of 1 penny each issued during the year 130
128,442,503 Ordinary shares of 1 penny each at 31 March 2024 1,284
14,558,366 Ordinary shares of 1 penny each held in treasury at 31 March 2023 (146)
2,054,182 Ordinary shares of 1 penny each purchased during the year to be held in treasury (20)
16,612,548 Ordinary shares of 1 penny each held in treasury at 31 March 2024 (166)
Voting rights of 111,829,955 Ordinary shares of 1 penny each at 31 March 2024 1,118
The Company purchased 2,054,182 shares (2023: 2,362,798) to be held in treasury at a nominal value of £20,542
and a cost of £2,450,000 (2023: £2,879,000) representing 1.6% of the shares in issue on 31 March 2024, leading to
a balance of 16,612,548 shares (2023: 14,558,366) in treasury representing 12.9% (2023: 12.6%) of the shares in
issue on 31 March 2024.
86 Albion Enterprise VCT PLC
Notes to the Financial Statements
Under the terms of the Dividend Reinvestment Scheme, the following new Ordinary shares of nominal value 1 penny
each were allotted during the year:
Date of allotment
Number of
shares allotted
Aggregate
nominal value
of shares
(£’000)
Issue price
(pence per share)
Net
invested
(£’000)
Opening
market price on
allotment date
(pence per share)
31 August 2023 420,051 4 124.21 503 118.50
29 February 2024 405,958 4 120.61 469 114.50
826,009 972
During the year the following new Ordinary shares of nominal value 1 penny each were allotted under the terms of
the Albion VCTs Prospectus Top Up Offers 2022/23 and 2023/24:
Date of allotment
Number of
shares allotted
Aggregate
nominal value
of shares
(£’000)
Issue price
(pence per share)
Net
consideration
received
(£’000)
Opening
market price on
allotment date
(pence per share)
14 April 2023
66,837
1 128.90 85 120.50
14 April 2023
37,836
- 129.50 48 120.50
14 April 2023
311,202
3 130.20 395 120.50
22 March 2024
1,483,216
15 128.70 1,871 119.50
22 March 2024
275,795
3 129.36 348 119.50
22 March 2024
9,626,249
96 130.03 12,142 119.50
28 March 2024
379,943
4 130.03 479 119.50
12,181,078 15,368
16. Basic and diluted net asset value per share
31 March 2024 31 March 2023
(pence per share) (pence per share)
Basic and diluted net asset value per Ordinary share 125.77 128.60
The basic and diluted net asset value per share at the year end is calculated in accordance with the Articles of
Association and is based upon total shares in issue (excluding treasury shares) of 111,829,955 Ordinary shares at
31 March 2024 (2023: 100,877,050).
17. Capital and financial instruments risk management
The Company’s capital comprises Ordinary shares as described in note 15. The Company is permitted to buy-back
its own shares for cancellation or treasury purposes.
The Company’s financial instruments comprise equity and loan stock investments in unquoted and quoted
companies, cash balances, receivables and payables which arise from its operations. The main purpose of these
financial instruments is to generate cash flow and revenue and capital appreciation for the Company’s operations.
The Company has no gearing or other financial liabilities apart from short term payables. The Company does not
use any derivatives for the management of its Balance sheet.
87Albion Enterprise VCT PLC
Notes to the Financial Statements
The principal financial instrument risks arising from the Company’s operations are:
• market and investment risk (which comprises investment price and cash flow interest rate risk);
• credit risk; and
• liquidity risk.
The Board regularly reviews and agrees policies for managing each of these risks. There have been no changes in
the nature of the risks that the Company has faced during the past year and there have been no changes in the
objectives, policies or processes for managing risks during the past year. The key risks are summarised below.
Market risk
As a Venture Capital Trust, it is the Company’s specific nature to evaluate the market risk of its portfolio in unquoted
companies. Market risk is the exposure of the Company to the revaluation and devaluation of investments as a
result of macroeconomic changes. The main driver of market risk is the dynamics of market quoted comparators,
as well as the financial and operational performance of portfolio companies. The Board seeks to reduce this risk by
having a spread of investments across a variety of sectors. More details on the sectors the Company invests in can
be found in the pie chart on page 14.
The Manager and the Board formally review market risk, both at the time of initial investment and at quarterly
Board meetings.
The Board monitors the prices at which sales of investments are made to ensure that profits to the Company are
maximised, and that valuations of investments retained within the portfolio appear realistic compared to prices
being achieved in the market for sales of unquoted investments.
Under FRS 102 the Board is required to illustrate by way of a sensitivity analysis the extent to which the assets are
exposed to market risk. In order to show the impact of sensitivity in market movements on the Company, a 10%
increase or decrease in the valuation of the fixed asset investment portfolio (keeping all other variables constant)
would increase or decrease the net asset value and return for the year by £10,551,000. Accordingly, a 20% increase
or decrease in the valuation of the fixed asset investment portfolio (keeping all other variables constant) would
increase or decrease the net asset value and return for the year by £21,103,000. Further sensitivity analysis on fixed
asset investments is included in note 11.
Investment risk (including investment price risk)
Investment risk (including investment price risk) is the risk that the fair value of future investment cash flows
will fluctuate due to factors specific to an investment instrument or to a market in similar instruments. The
management of risk within the venture capital portfolio is addressed through careful investment selection, by
diversification across different industry segments, by maintaining a wide spread of holdings in terms of financing
stage and by limitation of the size of individual holdings. The Manager receives management accounts from
portfolio companies and members of the investment management team often sit on the boards of unquoted
portfolio companies; this enables the close identification, monitoring and management of investment risk. The
Directors monitor the Manager’s compliance with the investment policy, review and agree policies for managing
this risk and monitor the overall level of risk on the portfolio on a regular basis.
Valuations are based on the most appropriate valuation methodology for an investment within its market,
with regard to the financial health of the investment and the IPEV Guidelines. Details of the industries in which
investments have been made are contained in the pie chart in the Strategic report on page 14.
The maximum investment risk on the balance sheet date is the value of the fixed asset investment portfolio which
is £105,513,000 (2023: £95,798,000). Fixed asset investments form 75% of the net asset value on 31 March 2024
(2023: 74%).
More details regarding the classification of fixed asset investments are shown in note 11.
88 Albion Enterprise VCT PLC
Notes to the Financial Statements
Interest rate risk
It is the Company’s policy to accept a degree of interest rate risk on its financial assets through the effect of
interest rate changes. On the basis of the Company’s analysis, it was estimated that a rise or fall of 1% in all
interest rates would have increased or decreased total return before tax for the year by approximately £346,000
(2023: £312,000).
The weighted average effective interest rate applied to the Company’s fixed rate assets during the year was
approximately 9.1% (2023: 7.8%). The weighted average period to expected maturity for the fixed rate assets is
approximately 3.1 years (2023: 3.6 years).
The Company’s financial assets and liabilities, all denominated in pounds sterling, consist of the following:
31 March 2024 31 March 2023
Fixed
rate
£’000
Floating
rate
£’000
Non-
interest
bearing
£’000
Total
£’000
Fixed
rate
£’000
Floating
rate
£’000
Non-
interest
bearing
£’000
Total
£’000
Unquoted equity - - 93,996 93,996 - - 82,583 82,583
Quoted equity - - 103 103 - - 430 430
Unquoted loan stock 8,485 - 2,929 11,414 11,833 - 952 12,785
Receivables* - - 143 143 - - 2,532 2,532
Current liabilities - - (1,355) (1,355) - - (1,489) (1,489)
Cash 12,427 23,887 - 36,314 - 32,860 - 32,860
20,912 23,887 95,816 140,615 11,833 32,860 85,008 129,701
*The receivables do not reconcile to the Balance sheet as prepayments are not included in the above table.
Credit risk
Credit risk is the risk that the counterparty to a financial instrument will fail to discharge an obligation or
commitment that it has entered into with the Company. The Company is exposed to credit risk through its
receivables, investment in unquoted loan stock and through the holding of cash on deposit with banks.
The Manager evaluates credit risk on loan stock and other similar instruments prior to investment, and as part of its
ongoing monitoring of investments. In doing this, it takes into account the extent and quality of any security held.
For loan stock investments made prior to 6 April 2018, which account for 68% of loan stock by value, typically loan
stock instruments have a fixed or floating charge, which may or may not have been subordinated, over the assets of
the portfolio company in order to mitigate the gross credit risk.
The Manager receives management accounts from portfolio companies, and members of the investment
management team often sit on the boards of unquoted portfolio companies; this enables the close identification,
monitoring and management of investment specific credit risk.
The Manager and the Board formally review credit risk (including receivables) and other risks, both at the time of
initial investment and at quarterly Board meetings.
The Company’s total gross credit risk on 31 March 2024 was limited to £11,414,000 (2023: £12,785,000) of
unquoted loan stock instruments, £36,314,000 (2023: £32,860,000) of cash deposits with banks and £176,000
(2023: £2,561,000) of other receivables.
At the balance sheet date, cash in bank and in hand held by the Company was held with Lloyds Bank plc, Scottish
Widows Bank plc (part of Lloyds Banking Group), Barclays Bank plc, Bank of Montreal, and National Westminster
Bank plc. Credit risk on cash transactions is mitigated by transacting with counterparties that are regulated entities
subject to regulatory supervision, with high credit ratings assigned by international credit-rating agencies.
89Albion Enterprise VCT PLC
The Company has an informal policy of limiting counterparty banking exposure to a maximum of 20% of net asset
value for any one counterparty.
The credit profile of unquoted loan stock is described under liquidity risk below.
Liquidity risk
Liquid assets are held as cash on current account, deposit or short term money market accounts or similar
instruments. Under the terms of its Articles, the Company has the ability to borrow up to 10% of its adjusted
share capital and reserves of the latest published audited Balance sheet, which amounts to £13,713,000 (2023:
£12,647,000) as at 31 March 2024.
The Company has no committed borrowing facilities on 31 March 2024 (2023: nil) and the Company had cash
balances of £36,314,000 (2023: £32,860,000). The main cash outflows are for new investments, buy-back of
shares and dividend payments, which are within the control of the Company. The Manager formally reviews the
cash requirements of the Company on a monthly basis, and the Board on a quarterly basis, as part of its review
of management accounts and forecasts. All the Company’s financial liabilities are short term in nature and total
£1,355,000 (2023: £1,489,000).
The carrying value of loan stock investments as analysed by expected maturity dates is as follows:
31 March 2024 31 March 2023
Redemption date
Fully
performing
£’000
Past due
£’000
Valued
below cost
£’000
Total
£’000
Fully
performing
£’000
Past
due
£’000
Valued
below cost
£’000
Total
£’000
Less than one year 6,966 - 81 7,047 5,148 87 - 5,235
1-2 years 567 - - 567 2,121 - - 2,121
2-3 years 47 - - 47 664 - - 664
3-5 years 1,315 - - 1,315 1,868 - - 1,868
5+ years 2,438 - - 2,438 2,897 - - 2,897
Total 11,333 - 81 11,414 12,698 87 - 12,785
Loan stock can be past due as a result of interest or capital not being paid in accordance with contractual terms.
The cost of loan stock investments valued below cost is £95,000 (2023: £nil).
The Company does not hold any assets as the result of the enforcement of security during the period and believes
that the carrying values for both those valued below cost and past due assets are covered by the value of security
held for these loan stock investments.
In view of the availability of adequate cash balances and the repayment profile of loan stock investments, the
Board considers that the Company is subject to low liquidity risk.
Fair values of financial assets and financial liabilities
All the Company’s financial assets and liabilities on 31 March 2024 are stated at fair value as determined by the
Directors, with the exception of receivables, payables and cash which are carried at amortised cost. There are no
financial liabilities other than payables. The Company’s financial liabilities are all non-interest bearing. It is the
Directors’ opinion that the book value of the financial liabilities is not materially different to the fair value and all
are payable within one year.
18. Commitments and contingencies
The Company had no financial commitments in respect of investments on 31 March 2024 (2023: £nil).
There are no contingent liabilities or guarantees of the Company on 31 March 2024 (2023: £nil).
Notes to the Financial Statements
90 Albion Enterprise VCT PLC
19. Post balance sheet events
Since the year end, the Company has had the following material post balance sheet events.
• On 2 July 2024, a NAV and portfolio company update announced that the sale of Egress Software
Technologies had completed. The sale of Egress returned over 7 times cost. This resulted in an unaudited
4.33 pence per share uplift, representing a 3.4% increase on the 31 March 2024 NAV. The NAV update
only reflects an adjustment in respect of the sale of Egress, and does not reflect a revaluation of the entire
portfolio.
• The Company issued the following new Ordinary shares of nominal value 1 penny each under the Albion
VCTs’ Prospectus Top Up Offers 2023/24:
Date of
allotment
Number of shares
allotted
Aggregate
nominal value of
shares
£’000
Issue price
(pence per share)
Net consideration
received
£’000
Opening market
price on allotment
date
(pence per share)
16 April 2024 82,167 1 128.70 104 119.50
16 April 2024 15,460 - 129.36 19 119.50
16 April 2024 266,592 3 130.03 336 119.50
364,219 459
20. Related party transactions
Other than transactions with the Manager as disclosed in note 5, and the Directors’ remuneration disclosed in
the Directors’ remuneration report on pages 61 to 64, there are no other related party transactions or balances
requiring disclosure.
Notes to the Financial Statements
91Albion Enterprise VCT PLC
INFORMATION
& FINANCIALS
NOTICE OF ANNUAL GENERAL MEETING
SHAREHOLDERS SHOULD TAKE NOTE THAT THIS WILL BE A VIRTUAL AGM AND FURTHER DETAILS WILL BE
MADE AVAILABLE AT WWW.ALBION.CAPITAL/VCT-HUB/AGMS-EVENTS.
NOTICE IS HEREBY GIVEN that the Annual General Meeting of Albion Enterprise VCT PLC (the “Company”) will be
held virtually at noon on 3 September 2024 for the purposes of considering and, if thought fit, passing the following
resolutions, of which resolutions 1 to 10 will be proposed as ordinary resolutions and resolutions 11 to 13 will be
proposed as special resolutions.
Ordinary Business
1. To receive and adopt the Company’s accounts for the year ended 31 March 2024 together with the Strategic
report and the reports of the Directors and Auditor.
2. To approve the Directors’ remuneration report for the year ended 31 March 2024.
3. To re-elect Christopher Burrows as a Director of the Company.
4. To re-elect Philippa Latham as a Director of the Company.
5. To re-elect Patrick Reeve as a Director of the Company.
6. To re-elect Rhodri Whitlock as a Director of the Company.
7. To appoint Johnston Carmichael as Auditor of the Company to hold office from the conclusion of the meeting
to the conclusion of the next meeting at which audited accounts are to be laid.
8. To authorise the Directors to agree the Auditor’s remuneration.
Special Business
9. Increase in Directors’ aggregate remuneration cap
That the aggregate amount of the ordinary remuneration cap of the Directors under Article 79 of the Articles of
Association of the Company be increased from £125,000 to an amount not exceeding £150,000 per annum.
10. Authority to allot shares
That the Directors be generally and unconditionally authorised in accordance with section 551 of the
Companies Act 2006 (the “Act”) to allot Ordinary shares in the capital of the Company (“Ordinary shares”)
up to an aggregate nominal amount of £257,613 (which comprises approximately 20% of the Company’s
issued Ordinary shares as at the date of this Notice) provided that this authority shall expire 15 months from
the date that this resolution is passed, or, if earlier, at the conclusion of the next Annual General Meeting of
the Company, but so that the Company may, before such expiry, make an offer or agreement which would or
might require shares to be allotted or rights to subscribe for or convert securities into shares to be granted
after such expiry and the Directors may allot shares or grant rights to subscribe for or convert securities into
shares pursuant to such an offer or agreement as if this authority had not expired.
11. Authority for the disapplication of pre-emption rights
That, subject to the authority and conditional on the passing of resolution number 10, the Directors be
empowered, pursuant to sections 570 and 573 of the Act, to allot equity securities (within the meaning of
section 560 of the Act) for cash pursuant to the authority conferred by resolution number 10 and/or sell
Ordinary shares held by the Company as treasury shares for cash as if section 561(1) of the Act did not apply
to any such allotment or sale.
Under this power the Directors may impose any limits or restrictions and make any arrangements which they
deem necessary or expedient to deal with any treasury shares, fractional entitlements, record dates, legal,
regulatory or practical problems in, or laws of, any territory or other matter, arising under the laws of, or the
requirements of any recognised regulatory body or any stock exchange in, any territory or any other matter.
92 Albion Enterprise VCT PLC
This power shall expire 15 months from the date that this resolution is passed or, if earlier, the conclusion of
the next Annual General Meeting of the Company, save that the Company may, before such expiry, make an
offer or agreement which would or might require equity securities to be allotted after such expiry and the
Directors may allot equity securities in pursuance of any such offer or agreement as if this power had not
expired.
12. Authority to purchase own shares
That, subject to and in accordance with the Company’s Articles of Association, the Company be generally
and unconditionally authorised, pursuant to and in accordance with section 701 of the Act, to make market
purchases (within the meaning of section 693(4) of the Act) of Ordinary shares of 1 penny each in the capital
of the Company (“Ordinary shares”), on such terms as the Directors think fit, provided always that:
(a) the maximum aggregate number of Ordinary shares hereby authorised to be purchased is 19,308,128 or,
if lower, such number of Ordinary shares as shall equal 14.99% of the issued Ordinary share capital of the
Company at the date of the passing of this resolution;
(b) the minimum price, exclusive of any expenses, which may be paid for an Ordinary share is 1 penny;
(c) the maximum price, exclusive of any expenses, which may be paid for each Ordinary share is an amount
equal to the higher of (a) 105% of the average of the middle market quotations for an Ordinary share,
as derived from the London Stock Exchange Daily Official List, for the five business days immediately
preceding the day on which the Ordinary share is purchased; and (b) the amount stipulated by Article 5(1)
of the Buy-back and Stabilisation Regulation 2003;
(d) the authority hereby conferred shall, unless previously revoked, varied or renewed, expire 15 months from
the date that this resolution is passed or, if earlier, at the conclusion of the next Annual General Meeting;
and
(e) the Company may make a contract or contracts to purchase Ordinary shares under this authority before
the expiry of the authority which will or may be executed wholly or partly after the expiry of the authority,
and may make a purchase of shares in pursuance of any such contract or contracts as if the authority
conferred hereby had not expired.
13. Notice period for General Meetings
That the notice required for General Meetings of the Company (other than an Annual General Meeting) shall
be not less than 14 clear days.
By Order of the Board
Albion Capital Group LLP
Company Secretary
Registered office
1 Benjamin Street
London, EC1M 5QL
11 July 2024
Albion Enterprise VCT PLC is registered in England and Wales with number 05990732.
Notice of Annual General Meeting
93Albion Enterprise VCT PLC
Notes
1. Members entitled to participate in, speak and vote at the Annual General Meeting (“AGM”) may appoint a proxy or
proxies (who need not be a member of the Company) to exercise these rights in their place at the AGM. A member may
appoint more than one proxy, provided that each proxy is appointed to exercise the rights attached to different shares.
Proxies may only be appointed by:
• completing and returning the Form of Proxy enclosed with this Notice to Computershare Investor Services PLC, The
Pavilions, Bridgwater Road, Bristol BS99 6ZY; or
• going to www.investorcentre.co.uk/eproxy and following the instructions provided there; or
• by having an appropriate CREST message transmitted, if you are a user of the CREST system (including CREST personal
members).
Return of the Form of Proxy will not preclude a member from participating in the meeting and voting in person. A
member may not use any electronic address provided in the Notice of this meeting to communicate with the Company
for any purposes other than those expressly stated.
To be effective the Form of Proxy must be completed in accordance with the instructions and received by the Registrars of
the Company by noon on 30 August 2024.
In accordance with good governance practice, the Company is offering shareholders use of an online service, offered
by the Company’s registrar, Computershare Investor Services, at www.investorcentre.co.uk/eproxy. Shareholders can use
this service to vote or appoint a proxy online.The same voting deadline of noon on 30 August 2024 applies as if you
were using your Personalised Voting Form to vote or appoint a proxy by post to vote for you.Shareholders who hold their
shares electronically may submit their votes through CREST, by submitting the appropriate and authenticated CREST
message so as to be received by the Company’s registrar not later than 2 business days before the start of the meeting.
Instructions on how to vote through CREST can be found by accessing the following website: www.euroclear.com/CREST.
Shareholders should not show this information to anyone unless they wish to give proxy instructions on their behalf.
2. Any person to whom this Notice is sent who is a person nominated under section 146 of the Companies Act 2006 (“the
Act”) to enjoy information rights (a “Nominated Person”) may, under an agreement between him or her and the member
by whom he or she was nominated, have a right to be appointed (or to have someone else appointed) as a proxy for the
AGM. If a Nominated Person has no such proxy appointment right or does not wish to exercise it, he or she may, under
any such agreement, have a right to give instructions to the member as to the exercise of voting rights.
The statement of rights of members in relation to the appointment of proxies in note 1 above does not apply to
Nominated Persons. The rights described in that note can only be exercised by members of the Company.
3. To be entitled to participate and vote at the AGM (and for the purpose of the determination by the Company of the votes
they may cast), members must be registered in the register of members of the Company at noon on 30 August 2024
(or, in the event of any adjournment, on the date which is two business days before the time of the adjourned meeting).
Changes to the register of members after the relevant deadline shall be disregarded in determining the rights of any
person to participate and vote at the meeting.
4. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may
do so for this AGM and any adjournment(s) by using the procedures described in the CREST Manual. CREST personal
members or other CREST sponsored members, and those CREST members who have appointed a voting service
provider(s), should refer to their CREST sponsor or voting service provider(s), who will be able to take the appropriate
action on their behalf.
In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST
message (a “CREST Proxy Instruction”) must be properly authenticated in accordance with Euroclear UK and Ireland
Limited’s specifications, and must contain the information required for such instruction, as described in the CREST Manual
(available via www.euroclear.com/CREST). The message, regardless of whether it constitutes the appointment of a proxy
or is an amendment to the instruction given to a previously appointed proxy must, in order to be valid, be transmitted so
as to be received by the issuer’s agent by noon on 30 August 2024. For this purpose, the time of receipt will be taken to
be the time (as determined by the time stamp applied to the message by the CREST Application Host) from which the
issuer’s agent is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST. After this time any
change of instructions to proxies appointed through CREST should be communicated to the appointee through other
means.
CREST members and, where applicable, their CREST sponsors or voting service provider(s) should note that Euroclear UK
and Ireland Limited does not make available special procedures in CREST for any particular message. Normal system
timings and limitations will, therefore, apply in relation to the input of CREST Proxy Instructions. It is the responsibility
of the CREST member concerned to take (or, if the CREST member is a CREST personal member or sponsored member
or has appointed a voting service provider, to procure that his or her CREST sponsor or voting service provider(s)
Notice of Annual General Meeting
94 Albion Enterprise VCT PLC
take(s)) such action as shall be necessary to ensure that a message is transmitted by means of the CREST system by
any particular time. In this connection, CREST members and, where applicable, their CREST sponsors or voting service
provider(s) are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST
system and timings.
The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the
Uncertificated Securities Regulations 2001.
5. Any corporation which is a member can appoint one or more corporate representatives who may exercise on its behalf all
of its powers as a member provided that they do not do so in relation to the same shares.
6. A copy of this Notice, and other information regarding the meeting, as required by section 311A of the Act, is available
from www.albion.capital/funds/AAEV under the ‘Fund reports’ section.
7. Any member participating in the meeting has the right to ask questions. The Company must cause to be answered any
such question relating to the business being dealt with at the meeting but no such answer need be given if (a) to do so
would interfere unduly with the preparation for the meeting or involve the disclosure of confidential information; (b) the
answer has already been given on a website in the form of an answer to a question; or (c) it is undesirable in the interests
of the Company or the good order of the meeting that the question be answered.
Given that the Company has some 10,000 shareholders, to enable the Board and the Manager to respond to questions,
and to ensure sufficient time is devoted to managing the assets on behalf of the shareholders, we ask that you submit
no more than two questions per shareholder, which should be of a substantive nature and relating to the business being
dealt with at the meeting.
8. Copies of contracts of service and letters of appointment between the Directors and the Company, together with the
Register of Directors’ Interests in the Ordinary shares of the Company, will be available for inspection at the Registered
Office of the Company during normal business hours from the date of this Notice until the conclusion of the meeting, and at
the place of the meeting for at least 15 minutes prior to the meeting until its conclusion. In addition, a copy of the Articles
of Association will be available for inspection at the Company’s registered office from the date of this Notice until the
conclusion of the meeting, and at the place of the meeting for at least 15 minutes prior to the meeting until its conclusion.
9. Under section 527 of the Act members meeting the threshold requirements set out in that section have the right
to require the Company to publish on a website a statement setting out any matter relating to: (i) the audit of the
Company’s accounts (including the Auditor’s report and the conduct of the audit) that are to be laid before the AGM;
or (ii) any circumstances connected with an Auditor of the Company ceasing to hold office since the previous meeting
at which the annual accounts and reports were laid in accordance with section 437 of the Act. The Company may not
require the members requesting any such website publication to pay its expenses in complying with section 527 and
528 of the Act. Where the Company is required to place a statement on a website under section 527 of the Act, it must
forward the statement to the Company’s Auditor not later than the time when it makes the statement available on the
website. The business which may be dealt with at the AGM includes any statement that the Company has been required
under section 527 of the Act to publish on a website.
10. Members satisfying the thresholds in Section 338 of the Companies Act 2006 may require the Company to give, to
members of the Company entitled to receive notice of the AGM, notice of a resolution which those members intend
to move (and which may properly be moved) at the AGM. A resolution may properly be moved at the AGM unless
(i) it would, if passed, be ineffective (whether by reason of any inconsistency with any enactment of the Company’s
constitution or otherwise); (ii) it is defamatory of any person; or (iii) it is frivolous or vexatious. The business which may be
dealt with at the AGM includes a resolution circulated pursuant to this right. A request made pursuant to this right may
be in hard copy or electronic form, must identify the resolution of which notice is to be given, must be authenticated by
the person(s) making it and must be received by the Company not later than 6 weeks before the date of the AGM.
11. Members satisfying the thresholds in Section 388A of the Companies Act 2006 may request the Company to include in
the business to be dealt with at the AGM any matter (other than a proposed resolution) which may properly be included
in the business at the AGM.
A matter may properly be included in the business at the AGM unless (i) it is defamatory of any person; or (ii) it is
frivolous or vexatious. A request made pursuant to this right may be in hard copy or electronic form, must identify the
matter to be included in the business, must be accompanied by a statement setting out the grounds for the request, must
be authenticated by the person(s) making it and must be received by the Company not later than 6 weeks before the
date of the AGM.
12. As at 11 July 2024 being the latest practicable date prior to the publication of this Notice, the Company’s issued
share capital consists of 128,806,722 Ordinary shares with a nominal value of 1 penny each. The Company also holds
16,612,548 Ordinary shares in treasury. Therefore, the total voting rights in the Company as at 10 July 2024 are
112,194,174.
Notice of Annual General Meeting
95Albion Enterprise VCT PLC
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