TIDMOTV1
Octopus Titan VCT 1 plc
Half-Yearly Results
5 June 2014
Octopus Titan VCT 1 plc, managed by Octopus Investments Limited, today
announces the Half-Yearly results for the six months ended 30 April
2014.
These results were approved by the Board of Directors on 5 June 2014.
You may shortly view the Half-Yearly Report in full at
www.octopusinvestments.com. All other statutory information will also be
found there.
Financial Headlines
92.2p Net asset value (NAV) at 30 April 2014
45.0p Cumulative dividends paid since launch
137.2p Total return (NAV plus cumulative dividends) at 30
April 2014
2.5p Interim dividend declared for the half-year to 30
April 2014
Shareholder Information and Contact Details
Financial Calendar
The Company's financial calendar is as follows:
24 July 2014 - 2014 interim dividend paid
February 2015 - Annual results for the year to 31
October 2014 announced; Annual Report and financial statements published
April 2015 - 2015 final dividend paid
Dividends
Dividends will be paid by the Registrar on behalf of the Company.
Shareholders who wish to have dividends paid directly into their bank
account rather than by cheque to their registered address can complete a
mandate form for this purpose. Queries relating to dividends,
shareholdings and requests for mandate forms should be directed to the
Company's Registrar, Capita Asset Services, by calling 0871 664 0300
(calls cost 10p per minute plus network extras. Lines are open
Monday-Friday 9.00am-5.30pm), or by writing to them at:
Capita Asset Services
The Registry
34 Beckenham Road
Beckenham
Kent
BR3 4BR
The table below shows the net asset value per share (NAV) and lists the
dividends that have been paid since the launch of Octopus Titan VCT 1
plc:
Period Ended NAV Dividends paid NAV + cumulative dividends
in period (total return)
30 April 2008 95.0p - 95.00p
31 October 2008 89.9p - 89.90p
30 April 2009 91.5p 0.50p 92.00p
31 October 2009 96.1p 0.50p 97.10p
30 April 2010 92.0p 0.50p 93.50p
31 October 2010 94.9p 0.50p 96.90p
30 April 2011 92.1p 0.75p 94.85p
31 October 2011 91.5p 0.75p 95.00p
30 April 2012 92.8p 1.00p 97.30p
31 October 2012 121.9p 1.50p 127.90p
30 April 2013 88.7p 34.00p 128.70p
31 October 2013 95.2p 2.50p 137.70p
30 April 2014 92.2p 2.50p 137.20p
The interim dividend of 2.5p per share for the six months ending 30
April 2014 will be paid on 24 July 2014, to those shareholders on the
register on 27 June 2014.
Share Price
The Company's share price can be found on various financial websites
including www.londonstockexchange.com, with the following TIDM/EPIC
code:
Ordinary shares
TIDM/EPIC code OTV1
Latest share price (5 June 2014) 87.5p per share
Buying and Selling Shares
The Company's Ordinary shares can be bought and sold in the same way as
any other company quoted on the London Stock Exchange via a stockbroker.
There may be tax implications in respect of selling all or part of your
holdings, so shareholders should contact their independent financial
adviser if they have any queries.
The Company operates a policy of buying its own shares for cancellation
as they become available. The Company is, however, unable to buy back
shares directly from shareholders. If you are considering selling your
shares or trading in the secondary market, please contact the Company's
corporate broker, Panmure Gordon (UK) Limited ('Panmure').
Panmure is able to provide details of close periods (when the Company is
prohibited from buying shares) and details of the price at which the
Company has bought shares. Panmure can be contacted as follows:
Chris Lloyd 020 7886 2716 chris.lloyd@panmure.com
Paul Nolan 020 7886 2717 paul.nolan@panmure.com
Notification of Change of Address
Communications with shareholders are mailed to the registered address
held on the share register. In the event of a change of address or other
amendment this should be notified to the Company's registrar, Capita, as
well as Octopus Investments Limited ('Octopus') under the signature of
the registered holder. Their contact details are provided at the end of
this report
Other Information for Shareholders
Previously published Annual Reports and Half-yearly Reports are
available for viewing on the Investment Manager's website at
http://www.octopusinvestments.com/investors/shareholder-information/titan-vct-1/.
All other statutory information will also be found there.
Warning to Shareholders
Many companies are aware that their shareholders have received
unsolicited phone calls or correspondence concerning investment matters.
These are typically from overseas based 'brokers' who target UK
shareholders offering to sell them what often turn out to be worthless
or high risk shares in US or UK investments. They can be very persistent
and extremely persuasive. Shareholders are therefore advised to be very
wary of any unsolicited advice, offer to buy shares at a discount or
offer for free company reports.
Please note that it is very unlikely that either the Company or the
Company's registrar would make unsolicited telephone calls to
shareholders and that any such calls would relate only to official
documentation already circulated to shareholders and never in respect of
investment 'advice'.
If you are in any doubt about the veracity of an unsolicited phone call,
please call either Octopus Investments, or the Registrar, at the numbers
provided at the back of this report.
About Octopus Titan VCT 1 plc
Octopus Titan VCT 1 plc ('Titan 1', 'Company' or 'VCT') is a venture
capital trust ('VCT') which aims to provide shareholders with attractive
tax-free dividends and long-term capital growth, by investing in a
diverse portfolio of predominately unquoted companies. The Company is
managed by Octopus Investments Limited ('Octopus' or 'Investment
Manager').
Titan 1 was incorporated on 12 October 2007. In collaboration with
Octopus Titan VCT 2 plc ('Titan 2'), the VCTs raised over GBP30.8
million in aggregate (GBP29.5 million net of expenses) through an Offer
for Subscription. A further GBP7.53 million in aggregate (GBP7.14
million net of expenses) has been raised by way of top-ups in 2010, 2012
and 2013. In 2014, to date GBP9.74 million in aggregate has been
allotted (GBP9.52 million net of expenses). Titan 1 invests primarily in
unquoted UK smaller companies and aims to deliver absolute returns on
its investments.
Venture Capital Trusts (VCTs)
VCTs were introduced in the Finance Act 1995 to provide a means for
private individuals to invest in unlisted companies in the UK.
Subsequent Finance Acts have introduced changes to VCT legislation. The
tax benefits currently available to eligible new investors in VCTs
include:
-- up to 30% up-front income tax relief;
-- exemption from income tax on dividends paid; and
-- exemption from capital gains tax on disposals of
shares in VCTs.
Titan 1 has been approved as a VCT by HM Revenue & Customs (HMRC). In
order to maintain its approval the Company must comply with certain
requirements on a continuing basis, including:
-- at least 70% of the Company's investments must comprise 'qualifying
holdings'*(as defined in the legislation);
-- for cash raised pre 6 April 2011 at least 30% of the 70% of qualifying
holdings must be in eligible ordinary shares with no preferential rights;
-- for cash raised post 5 April 2011 at least 70% of the 70% of qualifying
holdings must be in eligible ordinary shares with no preferential rights;
-- no single investment can exceed 15% of the total Company value; and
-- a minimum of 10% of each Qualifying Investment must be in Ordinary shares
with no preferential rights.
*A 'qualifying holding' consists of up to GBP5 million invested in any
one year in new shares or securities in an unquoted company (or
companies quoted on AIM) which is carrying on a qualifying trade and
whose gross assets do not exceed GBP15 million at the time of
investment. The definition of a 'qualifying trade' excludes certain
activities such as property investment and development, financial
services and asset leasing. The Company will continue to ensure its
compliance with these qualification requirements.
Financial Summary
Six months to Six months to Year to 31
30 April 2014 30 April 2013 October 2013
Net assets (GBP'000s) 29,313 19,795 20,865
Return on ordinary activities
after tax (GBP'000s) (30) 137 2,096
Net asset value per share (NAV) 92.2p 88.7p 95.2p
Cumulative dividends paid since 45.0p 40.0p 42.5p
launch
NAV plus cumulative dividends 137.2p 128.7p 137.7p
paid
Proposed Dividend 2.5p 2.5p 2.5p
Chairman's Statement
I am pleased to present the half-yearly results for Octopus Titan VCT 1
plc (the 'Company') for the six month period ended 30 April 2014.
Results
During this six month period, the total return of the Company has seen a
small decrease from 137.7 to 137.2 pence per share (being the net asset
value per share (NAV) plus cumulative dividends paid). This decrease in
total return is due largely to the standard running costs of the fund
exceeding the overall uplift in the portfolio.
Investment Portfolio Review
There was an overall increase of GBP364,000 in the portfolio during the
period with 5 companies having an uplift in valuation. The most
significant contributors were Semafone and Mi-Pay Group which had
uplifts in fair value of GBP247,000 and GBP159,000 respectively but it
was also necessary to recognise a reduction in value of three investee
companies.
During the six months to 30 April 2014, GBP1,878,000 was invested into 7
new companies and 5 follow-on investments. It is the Board's strategy to
continue to support portfolio businesses which have met or exceeded
performance expectations and where it makes economic sense as well as
investing into new companies which the Investment Manager believes have
potential for capital growth.
The fund has a diverse portfolio of 29 companies operating in a variety
of different market sectors and the Board believes the majority of these
are capable of developing capital growth in the coming years.
After 30 April 2014, the following new investments have been approved:
-- GBP274,000 into Sourceable Limited (Swoon Editions)
-- GBP471,000 into Zynstra
-- GBP150,000 into Origami Energy
-- GBP494,000 into Aframe Media Group
Fund Raising
The Company, together with the other Titan funds, offered the
opportunity to invest into the VCTs through a linked new share offer. It
is pleasing to report that this offer raised GBP9,522,000 net of costs
into the Fund, significantly exceeding our initial target of
GBP7,500,000.
The majority of funds raised will also be used to support existing
portfolio companies where the Investment Manager sees the opportunity
for business growth as well as investing in new businesses alongside the
other Titan funds.
Dividends
In accordance with our stated policy, your Board have decided to declare
an interim dividend of 2.5p (2013 2.5p) per share which will be paid on
24 July 2014 to shareholders on the register on 27 June 2014.
VCT Qualifying Status
PricewaterhouseCoopers LLP provides both the Board and Octopus with
advice concerning ongoing compliance with HMRC rules and regulations
concerning VCTs. The Board has been advised that Titan 1 continues to be
in compliance with the conditions laid down by HMRC for maintaining
approval as a VCT.
As at 30 April 2014, over 86% of the portfolio (as measured by HMRC
rules) was invested in VCT qualifying investments.
Principal Risks and Uncertainties
The Board continues to regularly review the risk environment in which
Titan 1 operates. There has been no significant change to the key risks
which were set out on page 12 of the annual report for the year ended 31
October 2013.
Outlook
Despite an overall decrease in the total return, it is pleasing to have
another consecutive period where there has been a positive uplift in the
valuation of Titan 1's portfolio. A number of our companies are maturing
and positioning themselves well in the market and with the new additions
to the portfolio made during the period we remain confident that we will
continue to see capital growth in the near future.
As the economy continues to improve, we are seeing a number of exciting
investment opportunities. We will work hard, alongside your Investment
Manager to utilise the recently raised money into these companies whilst
supporting the current portfolio.
Lewis Jarrett
Chairman
5 June 2014
Investment Portfolio
Carrying Change in
Investment value at valuation % voting % equity
cost at 30 Unrealised 30 April in the rights managed
Qualifying April 2014 profit/(loss) 2014 period held by by
investments Sector (GBP'000) (GBP'000) (GBP'000) (GBP'000) Titan 1 Octopus
Zenith Holding
company
Limited Other 4,895 3,081 7,976 (122) 33.33% 100.00%
TouchType
Limited Telecommunications 1,226 1,006 2,232 - 5.28% 19.04%
Getlenses Consumer lifestyle
Limited & wellbeing 824 147 971 58 5.89% 15.63%
UltraSoC
Technologies
Limited Technology 825 44 869 - 13.57% 55.11%
Mi-Pay Group
plc Telecommunications 1,004 (141) 863 159 5.73% 17.18%
e-Therapeutics Consumer lifestyle
plc & wellbeing 632 45 677 (30) 0.91% 3.28%
Metrasens Consumer lifestyle
Limited & wellbeing 490 81 571 - 4.99% 17.28%
Surrey
NanoSystems
Limited Technology 485 43 528 - 4.19% 14.26%
Bowman Power
Limited Environmental 519 (54) 465 (13) 2.70% 10.70%
Semafone
Limited Telecommunications 496 (52) 444 247 7.34% 26.17%
Consumer lifestyle
Kabbee Limited & wellbeing 400 - 400 - 1.55% 7.74%
Executive
Channel Europe
Limited Media 624 (257) 367 - 7.10% 30.00%
Michelson
Diagnostics Consumer lifestyle
Limited & wellbeing 627 (266) 361 - 5.69% 24.95%
Adbrain Limited Technology 300 - 300 - 1.65% 9.23%
Aframe Media
Group Limited Media 281 - 281 - 3.58% 33.19%
Artesian
Solutions
Limited Technology 185 - 185 - 1.12% 23.70%
Amplience
Limited Technology 172 - 172 - 1.89% 30.74%
Zynstra Limited Technology 100 50 150 50 1.23% 8.12%
Certivox
Limited Technology 150 - 150 - 1.00% 30.74%
Uniplaces Consumer lifestyle
Limited & wellbeing 106 - 106 - 5.81% 27.49%
Phasor
Solutions
Limited Technology 100 (35) 65 15 0.77% 0.98%
Consumer lifestyle
Tailsco Limited & wellbeing 39 - 39 - 0.77% 1.16%
Streethub Consumer lifestyle
Limited & wellbeing 26 - 26 - 0.90% 4.21%
Sofar Sounds Consumer lifestyle
Limited & wellbeing 14 - 14 - 0.38% 1.85%
AQS Holdings
Limited Environmental 655 (655) - - 14.20% 50.70%
The Key
Revolution
Limited Telecommunications 641 (641) - - 12.36% 35.88%
Phase Vision
Limited Technology 474 (474) - - 10.09% 42.96%
PrismaStar Inc. Media 424 (424) - - 2.58% 10.30%
Elonics Limited Technology 305 (305) - - 3.11% 19.54%
Total qualifying investments 17,019 1,193 18,212 364
Money market securities 7,413 - 7,413
Cash at bank 3,350 - 3,350
Total investments 27,782 1,193 28,975
Net current assets 338
Total net assets 29,313
Responsibility Statement of the Directors in respect of the half-yearly
report
We confirm that to the best of our knowledge:
-- the half-yearly financial statements have been prepared in accordance
with the statement 'Half-Yearly Financial Reports' issued by the UK
Accounting Standards Board;
-- the half-yearly report includes a fair review of the information required
by the Financial Services Authority Disclosure and Transparency Rules,
being:
-- an indication of the important events that have occurred during the first
six months of the financial year and their impact on the condensed set of
financial statements;
-- a description of the principal risks and uncertainties for the remaining
six months of the year; and
-- a description of related party transactions that have taken place in the
first six months of the current financial year, that may have materially
affected the financial position or performance of the Company during that
period and any changes in the related party transactions described in the
last annual report that could do so.
On behalf of the Board
Lewis Jarrett
Chairman
5 June 2014
Income Statement
Six months to 30 April Six months to 30 April
2014 2013 Year to 31 October 2013
Revenue Capital Total Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Realised gain
on disposal of
fixed asset
investments - 10 10 - - - - 670 670
Realised gain
on disposal of
current asset
investments - - - - 91 91 - 91 91
Fixed asset
investment
holding gains - 364 364 - 306 306 - 2,359 2,359
Current asset
investment
holding
gains/(losses) - - - - - - -
Other income 10 - 10 158 - 158 316 - 316
Investment
management
fees (52) (156) (208) (55) (167) (222) (107) (321) (428)
Performance fee
incentive - - - - (43) (43) - (536) (536)
Other expenses (206) - (206) (153) - (153) (376) - (376)
Return on
ordinary
activities
before tax (248) 218 (30) (50) 187 137 (167) 2,263 2,096
Taxation on
return on
ordinary
activities - - - - - - - - -
Return on
ordinary
activities
after tax (248) 218 (30) (50) 187 137 (167) 2,263 2,096
Earnings per
share - basic
and diluted (1.0)p 0.9p (0.1)p (0.3)p 1.0p 0.7p (0.8)p 11.2p 10.4p
-- The 'Total' column of this statement is the profit and loss account of
the Company; the supplementary revenue return and capital return columns
have been prepared under guidance published by the Association of
Investment Companies.
-- All revenue and capital items in the above statement derive from
continuing operations.
-- The Company has only one class of business and derives its income from
investments made in shares and securities and from bank and money market
funds.
-- The Company has no recognised gains or losses other than the results for
the period as set out above.
-- The accompanying notes are an integral part of the half-yearly report.
Reconciliation of Movements in Shareholders' Funds
Six months to 30 Six months to 30 Year to 31 October
April 2014 April 2013 2013
GBP'000 GBP'000 GBP'000
Shareholders'
funds at start of
period 20,865 21,382 21,382
Return on ordinary
activities after
tax (30) 137 2,096
Issue of equity
(net of
expenses) 9,522 4,581 4,581
Purchase of own
shares (390) (344) (677)
Dividends paid (654) (5,961) (6,517)
Shareholders'
funds at end of
period 29,313 19,795 20,865
Balance Sheet
As at 30 April As at 30 April As at 31 October
2014 2013 2013
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Fixed asset investments* 18,212 16,279 15,970
Current assets:
Money market securities and other
deposits* 7,413 2,734 156
Debtors 453 365 1,836
Cash at bank 3,350 563 3,499
11,216 3,662 5,491
Creditors: amounts falling due
within one year (115) (146) (596)
Net current assets 11,101 3,516 4,895
Net assets 29,313 19,795 20,865
Called up equity share capital 3,179 2,232 2,191
Share premium 8,490 5,816 5,816
Special distributable reserve 16,915 11,822 11,489
Capital redemption reserve 150 65 106
Capital reserve - losses on
disposal 300 (2,832) 1,512
-
holding
gains 1,195 3,243 419
Revenue reserve (916) (551) (668)
Total equity shareholders' funds 29,313 19,795 20,865
Net asset value per share 92.2p 88.7p 95.2p
*held at fair value through profit and loss
The statements were approved by the Directors and authorised for issue
on 5 June 2014 and are signed on their behalf by:
Lewis Jarrett
Chairman
Company Number: 06397764
Cash flow statement
Six months to 30 Six months to 30 Year to 31 October
April 2014 April 2013 2013
GBP'000 GBP'000 GBP'000
Net cash
inflow/(outflow)
from operating
activities 498 (185) (1,970)
Financial
investment:
Purchase of fixed
asset
investments (1,878) (2,680) (10,240)
Disposal of fixed
asset
investments 10 5,884 16,475
Management of
liquid
resources:
Purchase of
current asset
investments (8,057) (5,506) (5,506)
Disposal of
current asset
investments 800 4,599 7,178
Taxation - - -
Dividends paid (654) (5,961) (6,517)
Financing:
Issue of equity 9,522 4,581 4,581
Purchase of own
shares (390) (344) (677)
Increase in cash
resources at
bank (149) 388 3,324
Reconciliation of net cash flow to movement in net
funds
Six months to 30 Six months to 30
April 2014 April 2013 Year to 31 October 2013
GBP'000 GBP'000 GBP'000
Increase in cash
resources at
bank (149) 388 3,324
Movement in cash
equivalents 7,257 997 (1,581)
Opening net cash
resources 3,655 1,912 1,912
Net funds at
period end 10,763 3,297 3,655
Reconciliation of return before taxation to cash flow
from operating activities
Six months to Six months to
30 April 2014 30 April 2013 Year to 31 October 2013
GBP'000 GBP'000 GBP'000
Return on ordinary
activities before
tax (30) 137 2,096
(Gain)/loss on
disposal of current
asset investments - (91) (91)
(Gain)/loss on
disposal of fixed
asset investments (10) - (670)
Gain on valuation of
fixed asset
investments (364) (306) (2,359)
Gain on valuation of
current asset
investments - - -
Decrease/(increase)
in debtors 1,383 1,197 (274)
(Decrease)/increase
in creditors (481) (1,122) (672)
Inflow/(outflow)
from operating
activities 498 (185) (1,970)
Notes to the half-yearly Report
1. Basis of preparation
The unaudited half-yearly results which cover the six months to 30 April
2014 have been prepared in accordance with the Accounting Standard
Board's (ASB) statement on half-yearly financial reports (July 2007) and
adopting the accounting policies set out in the statutory accounts of
the Company for the year ended 31 October 2013, which were prepared
under UK GAAP and in accordance with the Statement of Recommended
Practice for Investment Companies issued by the Association of
Investment Companies in January 2009.
2. Publication of non-statutory accounts
The unaudited half-yearly results for the six months ended 30 April 2014
do not constitute statutory accounts within the meaning of Section 415
of the Companies Act 2006. The comparative figures for the year ended 31
October 2013 have been extracted from the audited financial statements
for that year, which have been delivered to the Registrar of Companies.
The independent auditor's report on those financial statements, in
accordance with chapter 3, part 16 of the Companies Act 2006, was
unqualified. This half-yearly report has not been reviewed by the
Company's auditor.
3. Earnings per share
The earnings per share is based on 25,763,913 (30 April 2013: 18,351,213
and 31 October 2013: 2,096,000) ordinary shares, being the weighted
average number of ordinary shares in issue during the period.
There are no potentially dilutive capital instruments in issue and
therefore no diluted returns per share figures are relevant. The basic
and diluted earnings per share are therefore identical.
4. Net asset value per share
The calculation of NAV per share as at 30 April 2014 is based on
31,785,730 (30 April 2013: 22,315,551 and 31 October 2013: 21,912,587)
ordinary shares in issue at that date.
5. Dividends
The interim dividend declared of 2.5 pence per share for the six months
ending 30 April 2014 will be paid on 24 July 2014, to those shareholders
on the register on 27 June 2014.
The final dividend of 2.5 pence per share for the year ending 31 October
2013 was paid on 4 April 2014 to those shareholders on the register on 7
March 2014.
6. Buy Backs
During the six months ended 30 April 2014 the Company bought back
407,562 Ordinary shares at a weighted average price of 84.25 pence per
share (six months ended 30 April 2013: 407,562 Ordinary shares at a
weighted average price of 84.25 pence per share and year ended 31
October 2013: 810,526 Ordinary shares at a weighted average price of
83.3 pence per share). During the six months to 30 April 2014,
10,318,209 shares were issued at a weighted average price of 92.3 pence
per share.
7. Related Party Transactions
Octopus Investments Limited acts as the Investment Manager of the
Company. Under the management agreement, Octopus receives a fee of 2.0
per cent per annum of the net assets of the Company for the investment
management services. During the period, the Company incurred management
fees of GBP208,000 payable to Octopus (30 April 2013: GBP222,000 and 31
October 2013: GBP428,000 with a further fee of GBP536,000 relating to
performance fees). At the period end there was GBPnil outstanding to
Octopus (30 April 2013: GBPnil and 31 October 2013: GBPnil). Furthermore,
Octopus provides administration and company secretarial services to the
Company. Octopus receives a fee of 0.3 per cent per annum of net assets
of the Company for administration services and GBP6,000 per annum for
company secretarial services.
8. Additional information
Copies of this report are available from the registered office of the
Company at 20 Old Bailey, London, EC4M 7AN.
This announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the information
contained therein.
Source: Octopus Titan VCT 1 PLC via Globenewswire
HUG#1791142
http://www.octopusinvestments.com
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