TIDMBSC
RNS Number : 6243H
British Smaller Companies VCT2 Plc
25 November 2022
British Smaller Companies VCT2 plc
Interim Management Statement
For the quarter ended 30 September 2022
British Smaller Companies VCT2 plc (the "Company") presents its
interim management statement for the quarter ended 30 September
2022. The statement also includes relevant financial information
between the end of the quarter and the date of this statement. A
copy of this interim management statement can be found at
www.bscfunds.com .
Overview
The Company's Total Return at 30 September 2022 was unchanged at
139.8 pence per ordinary share. During the same period the FTSE
Small Cap fell by 5.7 per cent.
Four follow-on investments were made in the period, into Vypr,
Force24, Vuealta and Wooshii, totalling GBP2.4 million.
Following the quarter end, two new investments and two follow-on
investments totalling GBP4.7 million have been completed, taking
the total invested in the current financial year to GBP12.8
million, following the GBP6.1 million invested in the whole of the
previous year.
Realisations in the period
During the period, the Company realised its investments in
Springboard and Intelligent Office, generating total proceeds of
GBP9.9 million in the period, realising a gain of GBP0.5 million
over the opening carrying value and GBP4.2 million over the
original cost.
The realisation of Springboard generated proceeds of GBP5.8
million, representing a capital profit over cost of GBP3.9 million,
an uplift of 46.0 per cent or GBP1.8 million on the carrying value
at the beginning of the year. Including income, the total return
from this investment was GBP6.6 million over a near eight year
holding period, producing an internal rate of return of 23 per cent
and a multiple of 4.1x cost. There is the prospect of further
consideration in 2023 based on performance targets; however, no
value has been recognised relating to these potential payments at
this time.
The sale of Intelligent Office generated proceeds of GBP4.1
million, representing a capital profit over cost of GBP2.1 million
and an uplift of 29.0 per cent, or GBP0.9 million, on the carrying
value at the beginning of the year. Including income, the total
return from this investment was GBP5.0 million over an eight and a
half year holding period, producing an internal rate of return of
14 per cent and a multiple of 2.6x cost.
Performance
The movement in Total Return in pence per ordinary share is set
out in the table below:
30 June Decrease Buyback Movement 30 September
2022 in Value of shares In Period 2022
Net Assets (GBPm) 109.6 (0.1) (0.3) (0.4) 109.2
------------ ---------- ----------- ----------- -------------
NAV per share
(PPS) 60.3p - - - 60.3p
------------ ---------- ----------- ----------- -------------
Cumulative dividends
paid (PPS) 79.5p - - - 79.5p
------------ ---------- ----------- ----------- -------------
Total Return
(PPS) 139.8p - - - 139.8p
------------ ---------- ----------- ----------- -------------
Shares in issue 181,720,724 - (556,386) (556,386) 181,164,338
------------ ---------- ----------- ----------- -------------
The unaudited NAV per ordinary share was unchanged at 60.3 pence
per share (30 June 2022: 60.3 pence per ordinary share).
The movements in NAV per ordinary share are set out in the table
below:
GBPm Pence per
ordinary share
NAV at 30 June 2022 109.6 60.3
Increase in portfolio value 0.3 0.2
Net operating costs (0.4) (0.2)
Buy-back of shares (0.3) -
------ ---------
(0.4) -
------ -------
NAV at 30 September 2022 109.2 60.3
------ ------ --------- -------
Following payment of the second interim dividend of 1.5 pence
per ordinary share for the year ending 31 December 2022 on 3
October 2022, the unaudited net asset value is 58.8 pence per
ordinary share.
Dividends and shares in issue
On 27 September 2022, the Company purchased 556,386 ordinary
shares of 10 pence each at a price of 56.36 pence per ordinary
share. These shares were placed in treasury.
The number of ordinary shares in issue at 30 September 2022 was
181,164,338 (30 June 2022: 181,720,724). In addition, at 30
September 2022 the Company held 18,048,870 ordinary shares in
treasury (30 June 2022: 17,492,484)
Following payment of the second interim dividend for the year
ending 31 December 2022 of 1.5 pence per ordinary share on 3
October 2022, the Company issued 922,314 ordinary shares under the
DRIS, taking cumulative dividends paid to 81.0 pence per ordinary
share and the number of ordinary shares in issue to 182,086,652 at
that date.
The Board has approved a special dividend of 2.25 pence per
ordinary share which will be paid on 11 January 2023 to those
shareholders on the Company's register at the close of business on
18 November 2022. The payment of the special dividend follows the
successful exits from the investments in Springboard and
Intelligent Office noted above.
Net assets
Net assets at 30 September 2022 comprised the following:
% of net
GBP000 assets
Unquoted investments at fair
value 71,038 65.0
Listed investment funds 1,326 1.2
Cash and cash equivalents 32,444 29.7
Other net current assets 4,414 4.1
-------- ---------
Net assets 109,222 100.0
======== =========
Investments
The investment portfolio at 30 September 2022 comprised:
Cumulative
valuation
as a %
Valuation of net
GBP000 assets
Matillion 20,721 19.0%
Outpost 5,469 24.0%
Unbiased 4,330 27.9%
Displayplan 3,967 31.6%
Wooshii 3,652 34.9%
Force24 3,188 37.8%
ACC Aviation 3,147 40.7%
Elucidat 2,699 43.2%
SharpCloud 2,668 45.6%
Vypr 2,661 48.1%
52,502 48.1%
Other investments 18,536 65.0%
Total investments 71,038 65.0%
========== ===========
Shareholder relations
The online Shareholder Workshop will be held on Thursday 1
December 2022 at 11:00am.
Fundraising
On 2 August 2022, the Company announced its intention to launch
a new joint offer for subscription for the tax year 2022-23 later
this year, alongside British Smaller Companies VCT plc. A
prospectus with full details of the proposed offer will be
published on or around 30 November 2022.
Outlook
In the face of a challenging economic environment, portfolio
companies are to date proving themselves to be adaptable and
resilient. It is expected that in these testing times, demand for
equity capital from the UK's smaller innovative businesses will
increase. Such conditions often prove to be an opportune time to
invest long term capital in fast growing businesses, and therefore
the planned fundraising by the Company will ensure it is well
placed to take advantage of new opportunities arising across the
United Kingdom.
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU No. 596/2014). Upon the
publication of this announcement via Regulatory Information Service
this inside information is now considered to be in the public
domain.
25 November 2022
For further information please contact:
David Hall YFM Private Equity Limited Tel: 0113 244 1000
Alex Collins Panmure Gordon (UK) Limited Tel: 0207 886 2767
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END
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