Interim Results
October 10 2001 - 12:56PM
UK Regulatory
RNS Number:4338L
Pennine AIM VCT PLC
10 October 2001
PENNINE AIM VCT PLC
CHAIRMAN'S REPORT
I am pleased to present the interim statement for Pennine AIM VCT plc for the
six months to 31 July 2001. This period witnessed continued volatility on
world equity markets as the slowdown which blighted the technology sector
spread into manufacturing and services. Share prices remain depressed and, as
the flow of corporate news continues to be poor, any significant rally is
unlikely to occur. As a consequence, many of the portfolio's holdings have
seen a fall in value. Amidst these extremely difficult market conditions,
significantly worsened by the tragic events of 11 September in USA, it is with
some satisfaction that I can report that several investee companies have made
good progress and we have realised significant profits. Though the net asset
value (NAV) of your company, after distributions, fell in the period under
review by 8.3% to 131.2p, the AIM Index fell by 28.2% over the same period.
INVESTMENTS
A steady stream of companies joined AIM during the period. In terms of VCT
legislation, qualifying investments as at 31 July 2001 were well above the 70%
minimum qualifying requirement set out by the Inland Revenue. The balance of
the portfolio has been invested in short-dated corporate bonds, in order to
ensure that your Company meets the requirement that 70% of its income is
derived wholly or mainly from shares and securities.
During the six months to 31 July 2001, four new qualifying investments have
been made: in RexOnline, Hearing Enhancement, Simply Hub and Fitzhardinge.
These additions have been made possible from profits realised on the holdings
in Connaught and Mears. Furthermore, as mentioned above, over #1 million has
been invested in the portfolio of corporate bonds.
NET ASSET VALUE
The unaudited NAV per share at 31 July 2001 was 131.2p, a rise of 38.1% from
the initial NAV of 95p (net of launch expenses) in March 1996. The capital
value of the AIM Index rose by 5.3% over the same period. In addition,
shareholders have received total tax free distributions of over 45p since
inception of the company, resulting in a total return of 75.4p.
In accordance with shareholder authority, the Company purchased an aggregate
of 127,000 ordinary shares for cancellation at 105p and 93.25p per share. This
has reduced the number of shares in issue to 4,262,385. As these purchases
were effected at a discount to the underlying asset value of your Company, the
NAV per share has been enhanced by 1p. Since the period end, a further 40,000
ordinary shares have been purchased at 93.375p, in accordance with a contract
made in July.
FUTURE
Since your Company's level of investment in qualifying companies is well above
the 70% minimum requirement, there is little scope for further investment
except from realised profits. The directors will continue to consider
investing, when possible, in companies with strong and experienced management
teams, a proven track record and visible revenue streams, in order to
diversify the portfolio further. Currently world markets are in turmoil,
following the outrages in USA, and it is difficult to make any projections. We
hope that further cuts in interest rates will be the catalyst for renewed
confidence in UK equity markets and that there will be opportunities for
selective investment in good proposals at sensible valuations.
HUGH GILLESPIE
CHAIRMAN 10 OCTOBER 2001
FINANCIAL SUMMARY
Six months Year Year Year Year Period
ended ended ended ended ended ended
31 Jul 2001 31 Jan 31 Jan 31 Jan 31 Jan 31 Jan
unaudited 2001 2000 1999 1998 1997
Per ordinary share
Net asset value before 131.2p* 163.1p 184.5p 113.4p 134.3p 107.7p
distributions
Net asset value after 131.2p 143.1p 174.5p 108.2p 129.7p 103.7p
distributions
Total return for the (12.98)p (14.17)p 76.3p (16.3)p 30.2p 12.4p
period
Total return since 75.45p 88.43p 102.6p 26.3p 42.6p 12.4p
inception
Total distribution for - 20p 10p 5.2p 5.2p 4.655p
the year (gross)
Total distribution since 45.055p 45.055p 25.055p 15.055p 9.855p 4.655p
inception (gross)
Share price 100p 110p 120p 107.5p 98.5p 96.5p
* represents an increase of 36.2p from the initial net asset value of 95p
after launch expenses of 5p.
At 30 September 2001 the share price was 70p.
STATEMENT OF TOTAL RETURN (INCORPORATING REVENUE ACCOUNT) OF THE COMPANY
Unaudited Unaudited Audited
Six months to 31 July Six months to 31 July Year to 31 January
2001 2000 2001
Revenue Capital Total Revenue Capital Total Revenue Capital Total
#000 #000 #000 #000 #000 #000 #000 #000 #000
Gains on
investments
- Realised - 562 562 - 1,020 1,020 - 2,461 2,461
- Unrealised - (1,100) (1,100) - (1,732) (1,732) - (3,008)(3,008)
Income 74 - 74 72 - 72 133 - 133
Investment (49) - (49) (60) - (60) (114) - (114)
management
fee
Other (45) - (45) (44) - (44) (88) - (88)
expenses
Net return
before (20) (538) (558) (32) (712) (744) (69) (547) (616)
finance
costs and
taxation
Interest - - - - - - - - -
payable
Return on
ordinary (20) (538) (558) (32) (712) (744) (69) (547) (616)
activities
before
taxation
Tax on - - - - - - - - -
ordinary
activities
Return on
ordinary
activities
after tax (20) (538) (558) (32) (712) (744) (69) (547) (616)
for the
financial
year to date
Dividends in
respect
of (11) - (11) (11) - (11) (22) - (22)
non-equity
shares
Return
attributable(31) (538) (569) (43) (712) (755) (91) (547) (638)
to equity
shareholders
Dividends in
respect
of - - - - (440) (440) - (878) (878)
equity
shares
Transfer
to (31) (538) (569) (43) (1,152) (1,195) (91) (1,425)(1,516)
reserves
Return per
ordinary(0.71)p(12.27)p (12.98)p (0.94)p(15.47)p(16.41)p (2.02)p(12.15)p(14.17)p
share Basic
and fully
diluted
SUMMARISED BALANCE SHEET
Unaudited Audited
At 31 July At 31 January
2001 2000 2001
#000 #000 #000
Investments 5,172 6,635 5,247
Net current assets/(liabilities) 420 (32) 1,035
Net assets 5,592 6,603 6,282
Capital and Reserves
Called-up share capital 426 439 439
Share premium - 3,924 -
Special reserve 3,924 - 3,924
Capital redemption reserve 35 23 22
Capital reserve 1,334 2,265 1,993
Revenue reserve (127) (48) (96)
Total shareholders' funds 5,592 6,603 6,282
Net asset value per share 131.19p 150.44p 143.12p
Notes:
1. The financial information given above does not constitute statutory
accounts within the meaning of Section 240 of the Companies Act 1985. The
statutory accounts of the Company for the year ended 31 January 2001, on
which the auditors gave an unqualified report, have been filed with the
Registrar of Companies.
2. Returns per ordinary share are based on 4,382,413 ordinary shares,
being the weighted average number of ordinary shares in issue throughout
the period. The net asset value per share is based upon the number of
shares in issue at the period end.
3. Investment values were calculated using mid market prices at 31 July 2001.
Unquoted investments and loan notes are stated at historical cost unless
in the opinion of the directors, there has been a diminution in value, in
which case this has been provided for.
4. Copies of these accounts will be posted to shareholders and are available
at the Company's registered office: Port of Liverpool Building, Pier Head,
Liverpool, L3 1NW.
CASH FLOW STATEMENT
Unaudited Audited
31 July 31
January
2001 2000 2001
Net cash flow from operating activities
Investment income received 27 61 96
Deposit interest received 28 20 37
Other cash payments (143) (121) (854)
Net cash outflow from operating activities (88) (40) (721)
Returns on investments and servicing of finance
Preference dividends paid (11) (7) (22)
Taxation 13 77 -
Capital expenditure and financial investment
Purchase of investments (1,327) (724) (1,252)
Disposal of investments 864 1,208 3,289
Equity dividends paid (441) (462) (439)
Financing
Purchase of own shares (121) (255) -
(Decrease)/increase in cash in the period/year (1,111) (203) 855
Reconciliation of net cash flow to movement in
funds
(Decrease)/increase in cash in the period/year (1,111) (203) 855
Net funds at 31 January 2001 1,494 639 639
Net funds at 31 July 2001 383 436 1,494
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