RNS Number:0511M
Singer & Friedlander AIM VCT PLC
06 June 2003
SINGER & FRIEDLANDER AIM VCT plc
Interim Report for the six month period ended 31st March 2003
Chairman's Statement
The Alternative Investment Market has been weak over the last six months
continuing the trend which started in early 2000, indeed since peaking in March
2000 the AIM Index has now declined by over 80%. During the six months to 31st
March the AIM Index declined by 10.3% and your Net Asset Value fell by a more
modest but still disappointing 8.5%.
The market performed poorly as fears over the deteriorating economic background
was compounded by the looming threat (now realised) of war in Iraq. The
apparently successful conclusion to hostilities in Iraq has encouraged a strong
rally in global stock markets including the UK's (after our period end). As yet
this has not fed down to the AIM to any great extent but should strength
continue then a positive impact would be anticipated.
Stock market valuations appear to have priced in the current adverse conditions
and significant scope exists for these valuations to rise once the current
uncertainties are removed and confidence returns to the markets.
J C Carrington
Chairman
6th June 2003
Manager's Report
As our Chairman has already stated markets including the AIM remained weak
during the first six months of our financial year although more recently
performance has been firmer. There has been a marked increase in the level of
takeover activity in recent months, which we believe indicates that stock market
valuations have fallen to unsustainably low levels. Within our portfolio Access
Plus has announced that it has received a bid approach causing the share price
to jump sharply. We await further developments but are cautious that as has been
seen in other instances bidders are being opportunistic in their timing and are
not willing to pay reasonable prices for companies.
The recent results reporting season saw most of our companies producing figures
in line with or in several cases ahead of expectations indicating that analyst
and shareholder expectations are now more realistic and that companies have now
reduced their cost bases to more closely match revised revenue expectations.
Against these more positive developments it has to be noted that the banks
remain nervous of their exposure to many smaller companies and we have observed
some situations where facilities have been removed in spite of good progress by
the customer (as evidenced by the recent failure of Affinity). It is likely that
this situation will prevail until the economic outlook improves.
We have seen a much steadier performance from our unquoted portfolio during the
period and we remain optimistic that we have significant recovery potential
across the entire portfolio over the medium term
A N Banks
Singer & Friedlander Investment Management Limited
6th June 2003
Unaudited Profit and Loss Account
Unaudited Unaudited Audited
6 months ended 6 months ended Year ended
31st March 31st March 30th September
2003 2002 2002
# # #
Revenue received on investments 59,752 77,706 156,445
Investment management fee - (38,750) (72,993)
Other expenses (104,037) (107,942) (213,181)
Net revenue (44,285) (68,986) (129,729)
Income from fixed asset investments
Realised gains/(losses) on investments 161,719 2,741 141,285
Profit/(loss) before tax 117,434 (66,245) 11,556
Tax on ordinary activities - 8,048 8,048
Profit/(Loss) on ordinary activities after taxation 117,434 (58,197) 19,604
Dividends proposed/paid - - -
Retained profit/(loss) 117,434 (58,197) 19,604
Transfer (to)/from capital reserves (161,719) 26,321 (86,540)
Retained loss (44,285) (31,876) (66,936)
Dividend per share - - -
Basic earnings per share 0.71p (0.35)p 0.12p
The net profit/(loss) above is derived from continuing operations.
Unaudited Statement of Total Recognised Gains and Losses
Unaudited Unaudited Audited
6 months ended 6 months ended Year ended
31st March 31st March 30th September
2003 2002 2002
# # #
Gain/(Loss) for the period 117,434 (58,197) 19,604
Unrealised (loss)/gain on revaluation of (589,173) 234,268 (3,013,484)
investments
Total recognised gains/(losses) relating to the (471,739) 176,071 (2,993,880)
period
Total recognised (losses)/gains per share (2.86)p 1.06p (18.16)p
Unaudited Balance Sheet
Unaudited Unaudited Audited
6 months ended 6 months ended Year ended
31st March 31st March 30th September
2003 2002 2002
# # #
Fixed Assets
Investments 4,598,660 8,333,707 5,152,769
Current assets
Debtors 24,543 41,245 55,858
Cash at bank and in hand 121,238 96,909 40,400
145,781 138,154 96,258
Creditors: amounts falling due within one year
Other creditors (2,922) (76,152) (5,419)
Accruals (30,745) (43,245) (61,095)
(33,667) (119,397) (66,514)
Net current assets 112,114 18,757 29,744
Net assets 4,710,774 8,352,464 5,182,513
Capital and reserves
Called up share capital 824,500 824,500 824,500
Share premium account 14,544,974 14,544,974 14,544,974
Special reserve - 296,026 296,026
Capital reserve (10,713,462) (7,151,117) (10,286,008)
Revenue reserve 54,762 (161,919) (196,979)
4,710,774 8,352,464 5,182,513
Net asset value per share #0.29 #0.51 #0.31
These accounts are unaudited and are not the Company's statutory accounts.
Summarised Cash Flow Statement
Unaudited Unaudited Audited
6 months ended 6 months ended Year ended
31st March 31st March 30th September
2003 2002 2002
# # #
Net cash (outflow)/inflow from operating activities (45,817) (86,165) (181,105)
Taxation - 89,380 106,080
Net financial investments 126,655 24,803 46,533
Net cash inflow/(outflow) 80,838 28,018 (28,492)
Net funds at beginning of period 40,400 68,891 68,892
Net funds at the end of the period 121,238 96,909 40,400
NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
1. Principal Accounting Policies
The following accounting policies have been applied consistently throughout the
period. Full details of principal accounting policies will be disclosed in the
Annual Report.
a) Basis of Accounting
The financial statements have been prepared under the historical cost
convention, modified to include the revaluation of fixed asset investments and
in accordance with applicable Accounting Standards in the United Kingdom and
with the Statement of Recommended Practice regarding the Financial Statements of
Investment Trust Companies.
b) Investments
Investments traded on AIM and OFEX are stated at Mid-Market prices as at 31st
March 2003. Unlisted investments are stated at the Directors' valuation.
Investments in unlisted companies are valued in accordance with the British
Venture Capital Association ("BVCA" guidelines), where appropriate. The
Directors' policy in valuing unlisted investments is to carry them at cost
except in the following circumstances:
- Where the company's under-performance against plan indicates a diminution in value of the
investment, provision against cost is made as appropriate.
- Where a company is well established and profitable, the shares may be valued by applying a suitable
price earnings ratio to the company's historic post-tax earnings. The ratio used is based on
comparable listed company or sector but discounted to reflect lack of marketability.
- Where a value is indicated by a material arms-length transaction by a third party in the shares of
a company.
Unquoted investments will not normally be revalued upwards for a period of at
least twelve months from the date of acquisition. Where trading in the
securities of an investee company is suspended, the investment is valued at the
Board's estimate of its net realisable value
c) Profit and Loss Account
The profit and loss account and revaluation reserves have been reclassified
between capital and revenue reserves following the revocation of the Investment
Company status in the year ended 30 September 2000.
2. Fixed Asset Investments
Summary of Investments at 31st March 2003
Opening Purchase Current % of
Valuation Cost Valuation portfolio by
30th September 31st March value
2002 2003
# # #
AIM Listed Companies
Access Plus 146,625 348,500 106,250 2.26
AERO Inventory 483,045 116,826 363,706 7.75
Blooms of Bressingham 135,134 517,434 115,261 2.46
Connaught 257,250 196,000 247,450 5.27
Hartford Group 75,000 100,000 29,063 0.62
Intelligent Environment 121,172 679,230 126,221 2.69
Maelor 36,492 200,157 68,961 1.47
Monotub Industries 6,116 237,425 - -
Myratech.net 8,100 468,000 9,000 0.19
Pennant International Group 11,115 218,446 5,866 0.13
Protec 68,080 133,936 96,113 2.05
Pubs 'n' Bars 283,950 418,942 274,640 5.85
SamedayBooks.co.uk 10,796 237,501 10,076 0.21
SpringHealth Leisure 50,777 344,250 41,310 0.88
Systems Union Group 117,000 292,500 133,875 2.85
Thomson Intermedia 44,175 299,250 45,600 0.97
Topnotch Health Club 32,625 382,500 8,438 0.18
Transcomm 176,425 292,932 106,521 2.27
Vianet Group 75,320 530,285 17,118 0.36
Winchester Entertainment 28,583 219,774 8,407 0.18
Xpertise 287,583 615,000 225,958 4.82
2,455,363 6,848,888 2,039,834 43.46
Fully Listed Companies
Affinity Internet 39,630 92,470 36,328 0.77
IS Solutions 23,000 380,000 11,000 0.23
Motion Media 8,344 350,375 45,404 0.97
XKO Group 86,250 300,000 77,500 1.65
157,224 1,122,845 170,232 3.62
OFEX Quoted Companies
Aquilo 158,938 391,550 95,363 2.03
Asap International 7,813 500,000 - -
166,751 891,550 95,363 2.03
Opening Purchase Current % of
Valuation Cost Valuation portfolio by
30th September 31st March value
2002 2003
# # #
Private Companies
Eurobenefits 65,000 327,000 65,000 1.39
Sportsweb Ltd 240,120 200,000 240,120 5.12
Wineworld 25,000 340,908 25,000 0.53
330,120 867,908 330,120 7.04
Total Qualifying Companies 3,109,458 9,731,191 2,635,549 56.15
Fixed Income Investments
Debentures and loan stocks
Barclays Bank 6.5% BDS 2004 361,690 357,355 358,383 7.64
361,690 357,355 358,383 7.64
UK Government loans
Treasury 5% STK 2004 1,434,720 1,388,100 1,427,020 30.41
1,434,720 1,388,100 1,427,020 30.41
Total Fixed Income Investments 1,796,410 1,745,455 1,785,403 38.05
Other Non Qualifying Investments
Aero Inventory* 127,490 42,166 98,445 2.10
Aquilo* 8,083 21,813 4,850 0.10
Aquilo Loan Notes* 25,000 25,000 25,000 0.53
Blooms of Bressingham* 34,000 47,492 29,000 0.62
Blooms of Bressingham (WTS) 1,100 2,508 250 0.01
Affinity Internet* 4,403 146,770 4,036 0.09
Hartford Group* 39,200 372,250 15,190 0.32
Topnotch Group* 3,625 20,906 937 0.02
Travelstore.com* 4,000 100,000 - -
Total 246,901 778,905 177,708 3.79
Sub Total 5,152,769 12,255,551 4,598,660 97.99
Cash held for investment purposes 8,451 - 94,110 2.01
Total 5,161,220 12,255,551 4,692,770 100.00
*Qualifying holdings must be first issued to the VCT and not purchased at a
later date in the secondary market. These holdings represent additional
purchases in the secondary market where the Investment Manager has made the
decision to increase the overall holding in these stocks.
3. Capital and reserves
Share Special Capital Capital Revenue
Premium Reserve Reserve Reserve Reserve
Account (realised) (unrealised)
# # # # #
At 1st October 2002 14,544,974 296,026 (1,445,696) (8,840,312) (196,979)
Transfer between reserves - (296,026) - - 296,026
Brought forward losses realised in the - - 116,800 (116,800) -
period
Unrealised loss for the period - - - (472,373) -
Gain/(Loss) for the period - - 44,919 - (44,285)
At 31st March 2003 14,544,974 - (1,283,977) (9,429,485) 54,762
4. Dividends
The directors do not recommend the payment of an interim dividend in respect of
the period ended 31st March 2003.
5. Cumulative returns
The cumulative dividend paid to date as at 31st March 2003 is 32.4 pence per
share.
6. Interim Report
The Company will be circulating the Interim Report to shareholders shortly and
copies will be available from the Registered Office of the Company, 21 New
Street, Bishopsgate, London EC2M 4HR.
Directors
A N Banks
J C Carrington
R A Pedder (resigned 31st March 2003)
A Puckridge
Secretary and Registered Office
Singer & Friedlander Secretaries Limited
21 New Street
London EC2M 4HR
Tel: 0207 623 3000
Fax: 0207 623 2122
Manager
Singer & Friedlander Investment Management Limited
(Authorised by the Financial Services Authority)
21 New Street
London EC2M 4HR
E-mail: info@sfim.co.uk
Website: www.sfim.co.uk
Registered in England & Wales No. 4138683
This information is provided by RNS
The company news service from the London Stock Exchange
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