RNS Number:5658V
PUMA VCT II plc
26 April 2007
For immediate release 26 April 2007
Puma VCT II plc
Unaudited Preliminary Final Results for the Year Ended 31 December 2006
Highlights
* Fully diluted NAV per share of 110.32p for Puma VCT II plc at year end (up
12.6% since inception, up 6.1% for the year). Unaudited fully diluted NAV
of 115.28p as at 28 February 2007.
* Five qualifying investments made in 2006, totaling #1.6 million for
Puma VCT II plc.
* Dividend of 0.9p proposed per Ordinary Share.
* Strong performance of alternative asset investments during and since
the year end.
Sir Aubrey Brocklebank Bt of Puma VCT II plc said:
"The year to 31 December 2006 has shown progress with a number of qualifying and
non qualifying investments contributing significantly to performance. We
continue to look for qualifying opportunities which meet our criteria to ensure
that we meet the minimum targets for qualifying investments of 70%. In the
meantime, we are confident in the prospects for our existing portfolio of
companies."
Enquiries
Shore Capital 020 7408 4090
Chris Ring
Graham Shore
Citigate Dewe Rogerson 020 7638 9571
Sarah Gestetner
Fiona Mulcahy
Notes to Editors
Puma VCT II plc is managed by Shore Capital's successful fund management team.
The Company's investment objective is to achieve high distributions to
shareholders. It will invest in a diversified portfolio of smaller companies,
including both AIM and Plus Markets traded and unquoted companies, selecting
companies which Shore Capital believes will have a relatively lower risk profile
than is typical for their size whilst having the opportunity for value
appreciation. Initially, whilst suitable VCT Qualifying Companies are being
identified, the Investment Manager invests the Company's funds in a range of
investments intended to generate a positive return, including funds of hedge
funds and other products which aim to achieve an absolute return. The VCT will
continue to hold a proportion of such products after building up the desired
holdings of VCT Qualifying Companies.
Chairman's Statement
The year to 31 December 2006 has shown satisfactory progress with a number of
qualifying and non qualifying investments contributing well to performance. I
am pleased to report that at the year end the Company's net asset value per
share ("NAV"), after deducting performance fees, stood at 110.32 p. This is a
rise of 6.31p, or 6.1% over the year and a rise of 12.32p, or 12.6% since
inception. Progress to date in 2007 has also been pleasing with the unaudited
NAV after performance as at 28 February 2007 standing at 115.28p, an increase of
4.5% since the year end.
Puma VCT plc and Puma VCT II plc have jointly invested in proportion to their
respective fundraising throughout the year.
Venture capital investments
The Company completed four new qualifying investments (Clarity Commerce
Solutions plc, Interactive World plc, Stocklight Limited and Vertu Motors plc)
and provided follow on financing into an existing investment, Cadbury House
Hotel & Country Club during the year. The Company also remains invested in
Patsystems and @UK, both qualifying holdings.
Puma VCT plc's first two investments of 2006 were both in AiM listed companies.
Clarity Commerce Solutions Plc is a leading supplier of software and services to
the leisure and hospitality sectors. This was followed by an investment in
Interactive World Plc, which distributes digital media content to mobile phones
via the internet.
We have seen impressive progress in Cadbury House Hotel & Country Club plc. This
was Puma VCT II plc's first qualifying investment, completed in June 2005. The
development has been going to plan and budget and the business has been
performing very strongly. Puma VCT II Plc took the opportunity to invest a
further #789,000 in October as part of a refinancing of their #12 million loan
facility.
Towards the end of 2006, Puma VCT II plc invested in Stocklight Limited, also an
unquoted company. Stocklight is the parent of Bloomsbury Auctions Limited,
Europe's largest specialist book auctioneer. The cash will be used as
development capital.
Puma VCT II plc's final investment of 2006 was in Vertu Motors Plc. Vertu's
strategy is to acquire and consolidate motor dealerships. To pursue this aim it
raised an initial #25 million from VCTs and institutions.
Aside from Cadbury House, the Company's other qualifying investments at 31
December 2005, were @UK and Patsystems. The companies, both listed on AiM,
delivered mixed performances during 2006. This is discussed further in the
Investment Manager's report.
At 31 December 2006, the Company's qualifying portfolio had a total cost of
#2,631,000 and was valued at #2,782,000 resulting in an unrealised gain of
#151,000. Further details are set out in the Investment Manager's Report.
Non-qualifying investments
The Investment Manager has continued to invest the non-qualifying investments on
an absolute return basis. We are extremely pleased with the appreciation in the
non-qualifying portfolio. The market value was #6,180,000 as at 31 December 2006
against an underlying book cost of #5,278,000.
Results and dividend
The total return for the year was #958,000 and the net total return for the year
was #524,000. Gross revenue for the period was #206,000 and net revenue return
after taxation was #45,000. The Board proposes a final revenue dividend of 0.9p
per ordinary share for the year. The ex-dividend date will be 02 May 2007 and
the record date 04 May 2007. Payment will be made to shareholders by 01 June
2007.
Annual General Meeting
The Annual General Meeting of the Company will be held at Bond Street House, 14
Clifford Street, London, W1S 4JU on 17 May 2007. Notice of the Annual General
Meeting and Form of Proxy have been sent separately to the annual accounts.
Outlook
We continue to look for qualifying opportunities that meet our criteria to
ensure that we meet the minimum targets for qualifying investments of 70%. In
the meantime, we are confident in the prospects for our existing portfolio of
companies.
Sir Aubrey Brocklebank Bt
Chairman
Investment Manager's Report
Overall Performance
In its second year, the Company has continued to deliver strong returns with the
net asset value per share of your Company having increased by 7.5 per cent. (6.1
per cent. net of performance fees) in the year. This compares very favourably to
the FTSE AiM index which rose by 0.8 per cent. This performance puts the
Company well on track to deliver the net 120 pence to investors targeted at
launch, which would be a post-tax return of 14.9 per cent. p.a. on the 60p net
cost to investors. Subsequent to the year end, the Company's investments have
continued to perform well, resulting in an NAV at 28 February 2007 of 115.28p.
This strong performance has been achieved by a combination of gains in the
qualifying portfolio and strong delivery from the manager's innovative approach
to the non qualifying investments where the manager's hedge fund strategy made a
significant contribution out-performing their benchmark indices. The hedge fund
returns have been achieved with low volatility (a normal measure of risk) in
keeping with the manager's focus on relatively lower risk opportunities. AiM
listed property related investments also performed well for the non qualifying
portfolio with investments in The Hotel Corporation plc, Puma Brandenburg
Limited and Dawnay Day Treveria plc showing strong gains.
The performance since launch demonstrates the benefits of our strategy and
positioning.
Activity
The Company completed five qualifying investments during the year. This included
four new investments and a follow-on investment in Cadbury House Hotel & Country
Club plc. We retained the qualifying investment in Patsystems and @UK but sold
our small holding in Debts.co.uk plc profitably.
In our report for the year ending 31 December 2005 we expressed our concerns
about the valuations of many of the VCT qualifying AiM IPOs, which we considered
to be too high. In 2006, although our focus was still on identifying private
companies, which fitted our lower risk investment mandate, we also invested in
two AiM IPOs and an AiM placing where we felt valuations were more realistic and
risk was lower. Having the ability to structure deals to invest in private
companies and also participate in AiM issues widens the net of potential
investments in addition to providing a better balance of risks within the
qualifying portfolio.
Puma VCT II plc and Puma VCT plc jointly invest in proportion to their
respective fundraising and along with Puma VCT III plc and Puma VCT IV plc which
raised funds in the first quarter of 2006 have also generally co-invested
together. We have found that having the ability to syndicate larger investments
within the Puma VCT family makes our offering more attractive for potential
private equity investments.
Puma VCT II plc invested in three AiM quoted companies during the year: Clarity
Commerce Solutions plc, Interactive World plc and Vertu Motors plc, discussed
further below.
The Company made its first investment of 2006 in Clarity Commerce Solutions Plc.
Clarity is an AiM quoted supplier of business management software focused on the
leisure industry (pubs, hotels, cinemas, restaurants etc). Puma VCT II plc
invested #98,000 in April 2006 on the back of the company winning some
significant contracts, providing a high level of recurring revenues. Although
the share price performance has been a little disappointing, we believe that the
underlying business is sound and we expect share price appreciation going
forward, as long as management execute to plan. Related to this last point, in
April 2007, a number of shareholders requisitioned an Extraordinary General
Meeting to effect a change in management. We expect further developments in the
near future and are hopeful that this will be positive for the company.
Puma VCT II plc invested #70,000 in Interactive World Plc in May as part of its
fundraising on admission to AiM. Interactive World is a digital content
provider, principally to mobile phone handsets. It has an exclusive agreement
with the Sports Group and therefore differentiates itself from other content
aggregators and distributors. In addition, the business is highly cash flow
generative and the offer was at an attractive valuation. The company trades on
an attractive yield and we expect further share price appreciation.
The Company's third AiM investment of 2006 was Vertu Motors plc. Puma VCT II plc
invested #407,000 as part of the #25 million fundraising in December. Vertu is
pursuing a buy and build strategy in the motor dealership industry. It was an
attractive opportunity for Puma VCT II plc as we were backing a highly
experienced management team to consolidate a fragmented industry which will be
supported by substantial property assets. Vertu's first acquisition of Bristol
Street Motors (after the year end) required an additional #26 million
fundraising at a 25% premium to our entry price. We believe this will underpin
our investment whilst providing a solid base for further acquisitions.
Puma VCT II plc made two investments in private companies; Cadbury House &
Country Club plc and Stocklight Limited.
In June 2005 Puma VCT II plc participated in a #4 million equity investment in
Cadbury House & Country Club plc. Since then the company has performed well. The
health club opened on time in May 2006 and impressively grew its membership from
1,600 to over 3,000 at the year end (ahead of forecasts). The banqueting and
conferencing facilities were also developed to budget in time for a busy summer
of weddings, which led to a successful Christmas period. The last stage in the
development is the hotel which should be open for business in May 2007. The
hotel will now be 72 rooms (from 63) and fitted out to a four star standard. We
have revalued upwards our original investment in Cadbury House based on an
independent professional valuation of the revised development which reflects the
increase in rooms and improved rating. Given the progress made we welcomed the
opportunity to invest an additional #789,000 in October, as part of a #12
million refinancing of bank debt. Although this investment will not participate
in the valuation uplifts we are seeing in the original investment it enabled us
to invest in a business which we know well and where we have strong security.
Stocklight Limited is the parent company of Bloomsbury Auctions, a fast growing
auction house. Puma VCT II plc invested #279,000 as part of a #2 million
fundraising together with Puma VCT plc, Puma VCT III plc and Puma VCT IV plc to
fund the further expansion of Bloomsbury Auctions. Growth is expected to come
from increasing the number of specialist departments and being able to attract
bigger and higher value lots by offering advances to potential vendors. The
company is also expanding into overseas markets. Although the growth prospects
of Bloomsbury Auctions were an attraction, primarily we liked the deal as it was
structured to provide good security on the investment.
Puma VCT II plc retained two investments in its qualifying portfolio, completed
during 2005: @UK plc and Patsystems plc. Patsystems continued to perform well
during the year, picking up new clients and generally meeting market
expectations. They have carved out a strong niche for themselves, providing
software within the derivatives trading market, and have grown on the back of
strong growth within this industry. High levels of recurring revenues should
underpin the price and make it a potentially attractive acquisition target.
Unfortunately @UK has proved disappointing. Despite an initial uplift following
its IPO on AiM, in December 2005, the company struggled to meet its initial
forecasts and its share price has reflected this failure. We believe the worst
of the news is now behind it and with a new CEO the company has a reasonably
robust platform to meet its more conservative forecasts.
Outlook
We are pleased with the performance of the Company over the year and believe
that we now have a good spread of qualifying companies. We also expect the
portfolio of non qualifying investments to continue to do well in the year
ahead. 2007 will see an increase in the rate and size of investments in
qualifying investments and we are confident that we will be able to identify
both private and AiM quoted companies which will satisfy Puma VCT II plc's
investment mandate.
Shore Capital Limited
Unaudited Investment Portfolio Summary
As at 31 December 2006
Unaudited
Investment Valuation Original Cost Gain/(Loss) Valuation as
#'000 #'000 #'000 % of NAV
Qualifying Investments - Unquoted
Cadbury House Hotel and Country Club plc 1,544 1,278 266 16%
Stocklight Limited 279 279 - 3%
Qualifying Investments - Quoted
@UK plc 108 285 (177) 1%
Clarity Commerce Solutions plc 80 98 (18) 1%
Interactive World plc 75 70 5 1%
Patsystems plc 242 214 28 3%
Vertu Motors Plc 454 407 47 5%
Total Qualifying Investments 2,782 2,631 151 30%
Non - Qualifying Investments
Hedge funds and equity investments 6,180 5,278 902 66%
Total investments 8,962 7,909 1,053 96%
Cash and other net assets 408 408 - 4%
9,370 8,317 1,053 100%
Unaudited Income Statement
For the year ended 31 December 2006
Unaudited Audited
Year ended For the period 10 December 2004
31 December 2006 to 31 December 2005
Revenue Capital Total Revenue Capital Total
#'000 #'000 #'000 #'000 #'000 #'000
Gains on investments - 752 752 - 620 620
Income 206 - 206 145 - 145
206 752 958 145 620 765
Investment management fees 54 162 216 29 87 116
Performance fees 12 119 131 5 78 83
Other expenses 87 - 87 67 - 67
153 281 434 101 165 266
Return on ordinary 53 471 524 44 455 499
activities before taxation
Tax on return on ordinary activities (8) 8 - (13) 13 -
Return on ordinary activities after
tax attributable to equity 45 479 524 31 468 499
shareholders
Basic and diluted return per 0.54p 5.77p 6.31p 0.41p 6.26p 6.67p
Ordinary Share (pence)
All revenue and capital items in the above statement derive from continuing
operations. No operations were acquired or discontinued in the year.
No separate Statement of Total Recognised Gains and Losses is presented as all
gains and losses are included in the Income Statement.
Unaudited Balance Sheet
As at 31 December 2006
Unaudited Audited
As at As at
31 December 2006 31 December 2005
#'000 #'000
Fixed Assets
Investments 8,962 6,490
Current Assets
Trades in advance - 339
Debtors 53 14
Cash at bank and in hand 505 1,965
558 2,318
Creditors - amounts falling due within one year (149) (92)
Net Current Assets 409 2,226
Total Assets less Current Liabilities 9,371 8,716
Creditors - amounts falling due after more than one year (1) (1)
(including convertible debt)
Net Assets 9,370 8,715
Capital and Reserves
Called up share capital 83 83
Capital reserve - realised 115 (213)
Capital reserve - unrealised 832 681
Other reserve 214 83
Revenue reserve 8,126 8,081
Equity Shareholders' Funds 9,370 8,715
Net Asset Value per Ordinary Share 112.90p 105.01p
Diluted Net Asset Value per Ordinary Share 110.32p 104.01p
Unaudited Cash Flow Statement
For the year ended 31 December 2006
Unaudited Audited
Year ended For the period to 10
31 December 2006 December 2004 to
#'000 31 December 2005
#'000
Operating activities
Investment income received 167 131
Investment management fees paid (157) (69)
Cash paid to Directors (14) (10)
Foreign exchange (loss)/gain on cash (36) 1
Other cash payments (67) (28)
Net cash (outflow)/inflow from operating activities (107) 25
Capital expenditure and financial investment
Purchase of investments (4,564) (6,262)
Proceeds from sale of investments 2,492 561
Decrease/(increase) in trades in advance 339 (339)
Acquisition costs (3) -
Net realised gain/(loss) on forward foreign exchange contracts 383 (154)
Net cash outflow from capital expenditure and financial (1,353) (6,194)
investment
Financing
Proceeds received from issue of ordinary share capital - 8,299
Expenses paid for issue of share capital - (166)
Proceeds received from issue of redeemable preference shares - 50
Redemption of redeemable preference shares - (50)
Proceeds received from issue of convertible loan notes - 1
Net cash inflow from financing - 8,134
Cash (outflow)/inflow in the year (1,460) 1,965
Reconciliation of net cash flow to movement in net funds
(Decrease)/increase in cash for the period (1,460) 1,965
Net cash at start of the period 1,965 -
Net funds at the period end 505 1,965
Unaudited Reconciliation of Movements in Shareholders' Funds
For the year ended 31 December 2006
Unaudited
For the year ended 31 December 2006
Called up Share Capital Capital Total
share premium reserve- reserve- Other Revenue
capital account realised unrealised reserve reserve
#'000 #'000 #'000 #'000 #'000 #'000 #'000
At 1 January 2006 83 - (213) 681 83 8,081 8,715
Total recognised gains for the - - 328 151 131 45 655
year
At 31 December 2006 83 - 115 832 214 8,126 9,370
Audited
For the period 10 December 2004 to 31 December 2005
Called up Share Capital Capital Total
share premium reserve- reserve- Other Revenue
capital account realised unrealised reserve reserve
#'000 #'000 #'000 #'000 #'000 #'000 #'000
Share issues in the period 83 8,216 - - - - 8,299
Expenses of share issues - (166) - - - - (166)
Total recognised gains for the - - (213) 681 83 31 582
period
Capital reconstruction - (8,050) - - - 8,050 -
At 31 December 2005 83 - (213) 681 83 8,081 8,715
Unaudited Notes to the Accounts
For the period year 31 December 2006
Change in accounting policies
This preliminary announcement has been prepared on the basis of the accounting
policies set out in the 2005 accounts, with the exception of the adoption of the
new Financial Reporting Standards ("FRS") 21-26, that have been issued by the
Accounting Standards Board as part of the convergence process between United
Kingdom Generally Accepted Accounting Practice with International Financial
Reporting Standards ("IFRS"). The adoption of these policies has not resulted in
any restatements of prior year figures. All other accounting policies have been
applied consistently during the current and prior years.
Investments
Realised surpluses or deficits on the disposal of investments are taken to
realised capital reserves, and unrealised surpluses and deficits on the
revaluation of investment are taken to unrealised capital reserves.
All investments have been designated as fair value through profit or loss, and
recognized on the trade date and are initially measured at cost. Thereafter the
investments are measured at subsequent reporting dates at fair value. Listed
investments and investments traded on AiM are stated at bid price at the
reporting date. Hedge funds, listed and unlisted, are valued at their
respective Net Asset Value per share at the reporting date. Unlisted
investments are stated at Directors' valuation with reference to the
International Private Equity and Venture Capital Valuation Guidelines ("IPEVC"):
* Investments which have been made within the last twelve months are
valued at cost except where the company's performance against plan is
significantly different from expectations on which the investment was made
in which case a change in its valuation is made as appropriate.
* Where a company is in the early stage of development, it will normally
continue to be held at cost on the basis described above.
* Where a company is well established after one year from the date of
investment the shares may be valued by applying a suitable price-earnings
ratio to that company's historical post tax earnings. The ratio used is
based on a comparable listed company or sector but discounted to reflect
lack of marketability. Alternative methods of valuation will include cost,
provision against cost or net asset value where such factors apply that
make one of these methods more appropriate.
Forwards/Hedging
The Company enters into forward contracts for the sale of foreign currencies in
order to hedge its exposure to fluctuations in currency rates in respect of some
of its investments. These forward contracts are recorded at fair value through
profit and loss. Any foreign exchange gain or loss is recorded by the Company
in the Capital Reserve - unrealised until settled. Once realised, the gain or
loss is taken to the Capital Reserve - realised.
Basic and diluted return per Ordinary Share
Unaudited Audited
For the period 10 December 2004 to
Year ended 31 December 2006 31 December 2005
Revenue Capital Total Revenue Capital Total
Return for the period 45,000 479,000 524,000 31,000 468,000 499,000
Weighted average number of shares 8,299,300 8,299,300 8,299,300 7,481,453 7,481,453 7,481,453
Return per Ordinary Share 0.54p 5.77p 6.31p 0.41p 6.26p 6.67p
Net Asset Value per Ordinary Share
Unaudited Audited
2006 2005
Basic Diluted Basic Diluted
Net assets 9,370,000 9,370,000 8,715,000 8,715,000
Number of Ordinary Shares 8,299,300 8,493,347 8,299,300 8,379,354
Net Assets Value per Ordinary Share (pence) 112.90p 110.32p 105.01 104.01p
Reconciliation of total return before capital expenditure and financing and
costs to net cash inflow from operating activities
Unaudited Audited
2006 2005
#'000 #'000
Total return before taxation 524 499
Gains on investments (752) (620)
Increase in debtors (39) (14)
Increase in creditors 65 76
Foreign exchange (loss)/gain on cash (36) 1
Performance fee to be effected through share-based payment 131 83
Net cash (outflow) /inflow from operating activities (107) 25
Note
The financial information set out in the announcement does not constitute the
Company's statutory accounts for the year ended 31 December 2006 or 2005. The
financial information for the year ended 31 December 2005 is derived from the
statutory accounts for that year which have been delivered to the Registrar of
Companies. The auditors reported on those accounts. Their report was unqualified
and did not contain a statement under section 237 (2) or (3) of the Companies
Act 1985. The statutory accounts for the year ended 31 December 2006 will be
finalised on the basis of the financial information presented by the directors
in this preliminary announcement and will be delivered to the Registrar of
Companies following the Company's Annual General Meeting.
A copy of the full annual report and financial statements for the year ended 31
December 2006 will be printed and posted to shareholders. Copies will also be
available to the public at the registered office of the Company at Bond Street
House, 14 Clifford Street, London W1S 4JU
The financial information contained within this preliminary announcement was
approved by the board on 25 April 2007.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR ILFILSEIRFID
Puma Vct Ii (LSE:PMV)
Historical Stock Chart
From Jun 2024 to Jul 2024
Puma Vct Ii (LSE:PMV)
Historical Stock Chart
From Jul 2023 to Jul 2024
