Capital for Colleagues plc - Half Yearly Investment Update PR Newswire

Capital for Colleagues plc / EPIC: CFCP / Market: NEX / Sector: Investment

25 September 2019

CAPITAL FOR COLLEAGUES PLC

(‘Capital for Colleagues’ or the ‘Company’)

HALF YEARLY INVESTMENT UPDATE

Capital for Colleagues, the investment vehicle focused on opportunities in the Employee Owned Business (‘EOB’) sector, is pleased to announce an investment update in respect of the six months ended 31 August 2019

Key Statistics for the six months:

    --  Portfolio comprised of 18 unquoted EOBs at the end of the six months (28
        February 2019: 17)

    --  Net Asset Value (‘NAV’) of £7,753,961 (28 February 2019: £7,419,833)

    --  NAV per share increased by 4.5% to 50.21 pence in the six-month period
        (28 February 2019: 48.05 pence per share)

        Material developments in the six months:


    --  A loan investment of £150,000 was made to enable South Cerney Outdoor
        Limited (“SCO”) to acquire the business and assets of South Cerney
        Outdoor, with an Employee Owned Trust being the major shareholder on
        completion. Based near Cirencester in Gloucestershire, SCO is focused on
        creating outdoor experiences that inspire personal challenge, fun,
        growth and adventure for the whole community, regardless of age or
        ability. Activities are available on an individual or group basis and
        include water sports and land-based activities at SCO’s leasehold site
        which cover 53 acres, 47 acres of which are a lake.
    --  The Company has agreed to sell its equity interest in Cotswold Valves
        Limited (“CVL”) for its acquisition cost of £220,000 in cash and to
        re-schedule all existing loans from CVL and its subsidiary totaling
        £450,000. The Directors of the Company expect that the full
        consideration for the disposal and the amounts outstanding on the loans
        will be received by the Company in the course of the next three years.

Further information on the Company’s investment portfolio is set out below.

UNQUOTED INVESTMENTS

As at 31 August 2019, the Company’s portfolio of unquoted investments was valued at £7,047,060 and comprised 18 companies operating across a range of sectors, as set out below:


Industrials (value: £4,615,290; 65.49% of Portfolio)

Construction and Materials                                     Support Services
Civils Store Limited                          Anthesis Consulting Group Limited
Ecomerchant Natural Building Materials                  Cotswold Valves Limited
Limited                                               Hire and Supplies Limited
Employee Owners Group Limited              Office for Public Management Limited
Merkko Group Limited                               Flow Control Company Limited
TPS Investment Holdings Limited                  Castlefield Corporate Advisory
                                                               Partners Limited

                                                                    Engineering
Industrial Transportation                                TG Engineering Limited
Place 2 Place Logistics Limited

Leisure & Travel (value: £150,000; 2.13% of Portfolio)

Recreational Services

South Cerney Outdoor Limited



Media (value: £489,636; 6.95% of Portfolio)

Exhibition Centres
The Homebuilding Centre (Holdings)
Limited


Technology (value: £1,792,134; 25.43% of Portfolio)

Software & Computer Services
2C Services Limited
Bright Ascension Limited
Computer Application Services Limited



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 £99 million per annum and support approximately 854 jobs.

Total Unquoted Investments (including short term loans) as at 31 August 2019

Cost: £5,299,596

Valuation (including capitalised costs): £7,047,060

Commenting on the investment update, Alistair Currie, Chief Executive of the Company, said:

“I am pleased with the further progress of the portfolio and I am confident that Capital for Colleagues and its shareholders will benefit as the portfolio matures and as we continue to expand our exposure to the exciting EOB sector”.

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 & 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 Directors of the Company are responsible for the contents of this announcement.

**ENDS**

For further information, please visit www.capitalforcolleagues.com or contact:



CAPITAL FOR COLLEAGUES PLC       01985 201 980
Richard Bailey, Chairman
Alistair Currie, Chief Executive

PETERHOUSE CAPITAL LIMITED       020 7469 0930
Mark Anwyl
Duncan Vasey



Capital for Colleagues

Capital for Colleagues is an investment company focused on the UK EOB sector. The Company has a proven management team, with a wide network of contacts and affiliates, as well as established access to investment opportunities, enabling the Company to execute its strategy and capitalise on EOB-focused investment opportunities. In addition, the Company educates and assists companies that are looking to launch employee ownership schemes, advising them, amongst other things, on how to secure investment and achieve their objectives.

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 Regulatory Information Service, this inside information is now considered to be in the public domain.