(‘Capital for Colleagues’ or the ‘Company’)
HALF YEARLY INVESTMENT UPDATE AND COVID-19 STATEMENT
Key Statistics for the six months:
-- Portfolio comprised of 18 unquoted EOBs at the end of the six months (31
August 2019: 18) -- Net Asset Value (‘NAV’) of £7,747,343 (31 August : £6,710,207 ) -- NAV per share increased by 15.5% to 50.17 pencein the six-month period (31 August : 43.45 penceper share) Material developments in the six months:
-- The Company invested a total of £405,000 in
The Security Awareness Group Ltd(‘TSAG’) - £300,000 in preference shares and ordinary shares and a loan of £105,000. -- TSAG is a recently formed company, established to acquire the business and assets of The Security Company (International) Limited(‘TSC’), which has been delivering behavioural change and security awareness programmes since 1997. Huntingdon-based TSC has clients in numerous sectors, including pharmaceuticals, atomic energy, precious metals, banking, government, IT, insurance and law; its clients include household names, such as Specsavers, KraftHeinz, the British Red Crossand the Prince’s Trust.
Further information on the Company’s investment portfolio is set out below.
Industrials (value: £4,150,388; 51.14% of Portfolio) Construction and Materials Support Services
Civils Store Limited Anthesis Consulting Group Limited Ecomerchant Natural Building Materials Hire and Supplies LimitedLimited Office for Public Management Limited Employee Owners Group Limited Flow Control Company Limited Merkko Group LimitedCastlefield Corporate Advisory TPS Investment Holdings Limited Partners Limited Engineering TG Engineering LimitedIndustrial Transportation Place 2 Place Logistics LimitedLeisure & Travel (value: £232,000; 2.86% of Portfolio) Recreational Services South Cerney Outdoor LimitedMedia (value: £596,519; 7.35% of Portfolio) Exhibition Centres The Homebuilding Centre ( Holdings) Limited Technology(value: £3,137,101; 38.65% of Portfolio) Software & Computer Services 2C Services Limited Bright Ascension Limited Computer Application Services Limited The Security Awareness Group Ltd
The loans and investments made by the Company to unquoted EOBs are aimed at delivering equity-like returns. Each loan or investment is tailored to the individual investee company’s operating performance and specific working capital needs.
The Directors believe that the unquoted EOBs in the Company’s portfolio currently generate total turnover of around £101 million per annum and support approximately 880 jobs.
Total Unquoted Investments (including short term loans) as at
Valuation (including capitalised costs): £8,116,008
BASIS OF VALUATION
Each of the unquoted investments is included at the Directors’ assessment of fair value, in accordance with International Private Equity and Venture Capital Guidelines. The previous policy of providing a general provision equivalent to 2% of the value of the unquoted investments has now been discontinued in favour of a more specific and prudent review of individual investments.
Account is taken of any potential taxation liability in respect of the increase in value of investments on an annual basis, as at the Company’s year-end.
The above financial figures were prepared as at
-- The Board applauds the
UKgovernment initiatives which mitigate against the worst effects for UKbusinesses. Our Employee Ownership principles will stand our investee businesses in good stead during the weeks and months ahead and leave them in good shape for the anticipated return to normal business in due course.
Capital for Colleagueshas sufficient cash resources to maintain its operations and to allow flexible treatment of investee companies and their obligations.
-- Covid-19 has affected the value of all businesses and the Company will not be an exception to this. The Board has specifically reviewed the carrying values of all investments in the context of changes since 29
February 2020and has concluded that the value of the Company’s portfolio as a whole has likely reduced by an amount in the range of 10% to 15%. Therefore, the Directors believe that the declared NAV per share of 50.17p needs to be discounted (tax adjusted) to be within a range of 45.1p and 42.6p per share.
-- However, this is a rapidly evolving situation, with no guarantee as to when business life may revert to some semblance of normality. We will continue to monitor our investee companies in light of the changing situation, including considering any further impact upon the value of our portfolio of investments.
The Board would like to send all shareholders, investees, suppliers and staff its best wishes and offer its support over the coming months.
The Directors of the Company are responsible for the contents of this announcement.
For further information, please visit www.capitalforcolleagues.com or contact:
CAPITAL FOR COLLEAGUES PLC01985 201 980 Richard Bailey, Chairman Alistair Currie, Chief Executive PETERHOUSE CAPITAL LIMITED 020 7469 0930 Mark Anwyl Duncan Vasey
Market Abuse Regulation (MAR) Disclosure
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement via a