ANNUAL REPORT
TRIPLE POINT
VCT 2011 PLC
FOR THE YEAR ENDED
28 FEBRUARY
2022
OVERVIEW
Financial Summary
4
Key Highlights
5
STRATEGIC REPORT
Chair’s Statement
7
Company Strategy and Business Model
16
Investment Manager’s Review
30
Responsible Investing
42
Investment Portfolio Summary
44
10 Largest Investments
46
GOVERNANCE
Board of Directors
52
Corporate Governance Report
53
Audit Committee Report
58
Directors’ Remuneration Report
62
Directors’ Report
68
Directors’ Responsibility Statement
72
Independent Auditor’s Report
73
FINANCIAL STATEMENTS
Statement of Comprehensive Income
80
Balance Sheet
81
Statement of Changes in Shareholders’ Equity
82
Statement of Cash Flows
83
Notes to the Financial Statements
84
UNAUDITED NON-STATUTORY ANALYSIS OF:
The A Share Fund
100
The B Share Fund
102
The Venture Share Fund
104
INFORMATION
Shareholder Information
106
Financial Calendar
107
CONTENTS
Triple Point VCT 2011 plc (“the Company” or “TP11”) is a Venture Capital Trust (“VCT”). The Investment Manager is
Triple Point Investment Management LLP (“TPIM” and “Triple Point”). The Company was incorporated in July 2010.
The Strategic Report on pages
6 to 51, the Directors’ Report on
pages 68 to 71, the Corporate
Governance Report on pages 53 to
57 and the Directors’ Remuneration
Report on pages 62 to 67 have
each been drawn up in accordance
with the requirements of English
law and liability in respect thereof
is also governed by English law. In
particular, the responsibility of the
Directors for these reports is owed
solely to Triple Point VCT 2011 plc.
The Directors submit to the members
their Annual Report and Financial
Statements for the Company for the
year ended 28 February 2022.
Year ended 28 February 2022
Venture Fund
A Shares
B Shares
Total
Net assets
£’000
30,031
1,291
3,903
35,225
Net asset value per share (NAV)
Pence
113.55p
13.25p
57.69p
Profit/(Loss) before tax
£’000
5,240
(269)
147
4,976
Earnings/(Loss) per share
Pence
22.57p
(2.71p)
0.31p
Cumulative return to Shareholders (p)
Net asset value per share
113.55p
13.25p
57.69p
Total dividends paid
6.00p
106.50p
10.00p
Net asset value plus dividends paid (Total Return)
1
119.55p
119.75p
67.69p
Year ended 28 February 2021
Venture Fund
A Shares
B Shares
Total
Net assets
£’000
14,209
5,216
3,907
23,331
Net asset value per share
Pence
93.26p
52.43p
57.36p
Profit/(Loss) before tax
£’000
(209)
172
(2,772)
(2,809)
Earnings/(Loss) per share
Pence
(1.16p)
1.40p
(40.41p)
Cumulative return to Shareholders (p)
Net asset value per share
93.26p
52.43p
57.36p
Total dividends paid
3.00p
70.00p
10.00p
Net asset value plus dividends paid (Total Return)
1
96.26p
122.43p
67.36p
FINANCIAL
SUMMARY
A Ordinary Shares
(“A Shares”)
On 30 April 2015 the A Share
Class offer closed having raised
£10.3 million with a total of
9,951,133 A Shares being issued.
B Ordinary Shares
(“B Shares”)
On 29 April 2016 the B Share
Class offer closed having raised
£6.97 million with a total of
6,824,266 B Shares being issued.
Venture Fund
Venture Fund: On 20 August 2021 the second Venture Fund offer closed
having raised gross proceeds of £10.70 million with a total of 8,107,879
additional Venture Shares being issued. Since this offer closed, the Venture
Fund has allotted further Shares, with 36,418,808 in issue as at May 2022.
1
Total Return is defined as an Alternative Performance Measure.
4 |
Triple Point VCT 2011 plc
OVERVIEW
As at 28 February 2022
2
Total Return and Ongoing Charges Ratio are defined as APMs. The Board considers Total Return to be the primary measure of Shareholder value. Total Return is made
from totalling the current Net Asset Value plus Dividends paid to date. More information on Total Return is on page 18.
3
A dividend of 10p was paid following the year-end on 31 March 2022 to B Ordinary Class Shareholders on the register on 18 March 2022.
4
The value to be distributed will also be subject to the performance fee payable on distribution and other relevant fees and costs. As a result the total return may be
lower than indicated in this Annual Report.
Net Asset Value per
B Share
57.69p
(Year ended 28 Feb 2021: 57.36p)
Total Return per
B Share
2
67.69p
(Year ended 28 Feb 2021: 67.36p)
Dividends per
A Share
36.50p
(Year ended 28 Feb 2021: 6.75p)
Total Return per
A Share
2,4
119.75p
(Year ended 28 Feb 2021: 122.43p)
Realisation
Proceeds
£3.96m
Realisations of investments and loan
repayments generated total proceeds for
the Company. (2021: £550k).
Ongoing Charges Ratio
2
The ongoing charges ratio is a ratio of annualised
ongoing charges expressed as a percentage of
average net asset values throughout the year.
(2021: 3.03%)
Fundraising
£10.70m
The Venture Fund offer which closed on
20 August 2021 raised net proceeds of
£10.70 million.
Net Asset Value per
Venture Share
113.55p
(Year ended 28 Feb 2021: 93.26p)
Dividends per
Venture Share
3.00p
(Year ended 28 Feb 2021: 3.00p)
Total Return per
Venture Share
2
(Year ended 28 Feb 2021: 96.26p)
119.55p
2.94%
KEY
HIGHLIGHTS
Net Asset Value per
A Share
13.25p
4
(Year ended 28 Feb 2021: 52.43p)
Dividends per
B Share
Nil
3
(Year ended 28 Feb 2021: 5.00p)
The Annual Report contains a number of Alternative Performance Measures (“APMs”). APMs are financial measures
that are in addition to those defined or specified in the Company’s reporting framework.
OVERVIEW
Triple Point VCT 2011 plc | 5
STRATEGIC
REPORT
I am writing to present the Financial Statements for the
Company for the year ended 28 February 2022.
I am pleased to announce that during the year
we completed the sale of a substantial part of our
hydroelectric power portfolio (“Hydro Assets”) held in
the A and B Ordinary Share Classes, following which a
significant portion of the proceeds were distributed to
A Shareholders during the year, and to B Shareholders
following the year end.
The Board are pleased to welcome Julian Bartlett
onto the Board as an Independent Non-Executive
Director and Chair of the Audit Committee with effect
from 8 February 2022. We would also like to take the
opportunity to thank Tim Clarke for his valuable and
significant contribution to the Company over the years
he has served on the Board. Tim will retire following this
year’s AGM with our best wishes for the future.
Our Venture portfolio has continued to perform well,
having made 11 new qualifying investments and various
follow-on rounds due to continued growth, at a total
of £9.0 million. The Venture portfolio also successfully
completed their first exit at a significant premium shortly
after the year end; further detail on the sale can be
found below and in the Investment Manager’s Review
on pages 30 to 41. Partly as a result of this exit but also
reflecting strong performance by a number of portfolio
companies the Venture NAV has risen by over 21.7% on
a total return basis over the year in review.
The Company’s funds at 28 February 2022 were 82.67%
invested in a portfolio of VCT qualifying and non-
qualifying unquoted investments. At the year-end, the
Company’s Qualifying status percentage was above 80%.
This is due to the Company having three years before
undeployed cash counts towards the qualifying status
under current VCT regulations.
The Investment Manager’s Review on pages 30 to
41 gives a more detailed update on the portfolio of
investments in 30 small unquoted businesses.
Jane Owen
Chair
Our Venture portfolio has continued
to perform well, having made 11
new qualifying investments and
various follow-on rounds due to
continued growth, at a total
of £9.5 million.
CHAIR’S
STATEMENT
Triple Point VCT 2011 plc
| 7
STRATEGIC REPORT
Chairman’s Statement
THE VENTURE FUND COMPLETED ITS
FIRST CASH EXIT SHORTLY AFTER THE
YEAR-END FOR AN OVER 5X RETURN
MULTIPLE JUST TWO YEARS AFTER
THE INVESTMENT WAS MADE.
Quit Genius, the world’s first digital clinic for treating substance addiction.
STRATEGIC REPORT
8 | Triple Point VCT 2011 plc
This is the third year of the Venture Fund and a year of
progress after the challenges of Covid-19. The Venture
Fund completed its first cash exit shortly after the year-
end, on Credit Kudos Limited (“Credit Kudos”), for an
over 5x return multiple just two years after the investment
was made. Fintech, Middleware (software that acts as
a bridge between an operating system or database
and applications) and Healthtech have been our most
successful sectors having certainly benefited from an
accelerated move to digital since the onset of Covid-19.
While our Investment Manager’s challenge-led approach
has performed well to date overall, Shareholders should
remain aware that failed investments are a natural part of
venture investing.
Continuing intense concerns about Covid-19 at the start of
this period have quickly morphed into concerns regarding
the combination of higher inflation, higher interest rates
and the Ukraine-Russia war. While the direct impact of
these factors on the type of software companies that the
Venture Share Class invests in should be relatively limited,
the Investment Manager is monitoring developments
carefully (please refer to the Investment Manager’s
Review on pages 30 to 41). All in all, we believe that the
opportunities abound for seed stage investments and that
the existing portfolio remains well positioned for future
growth.
The third Venture Fund offer for subscription closed
on 20 August 2021 having raised £10.70 million and
the fourth offer for subscription is now open. Following
the 28 February 2022 year end, the Company allotted
an additional 9,973,377 Venture Shares raising £11.2
million, this takes the total number of Shares in issue to
36,418,808. The current fundraise is progressing well and
at 28 February 2022, the Venture Fund was 50% up on last
year’s fundraise, which puts us in a strong position. These
allotments and the growth of the Venture Fund has further
benefited the Company by way of a reduction in the
ongoing charges ratio from 3.03% to 2.94%.
The Venture Fund’s aim is to build a portfolio of qualifying
Investments in early-stage companies capable of
generating significant long-term capital growth and with a
bias to the business-to-business technology sector whilst
enabling investors to take advantage of the substantial tax
reliefs available to investors in VCTs, including 30% income
tax relief on amounts invested.
In line with the Share Class’s key objectives, I am pleased
to announce that a further dividend of 3 pence per Share
will be paid on 5 September 2022.
A snapshot of the new companies the Venture Fund has
invested into during the year is set out overleaf.
Venture Fund
Total Dividends
Paid Per Share
6.00
PENCE
Triple Point VCT 2011 plc
| 9
STRATEGIC REPORT
CHAIR’S STATEMENT
Gameplan Technology Ltd, trading as Ryde
(“Ryde”) provides a fully integrated delivery
management platform combining the best
of fleet management software, third party
logistics software and a flexible workforce to
E-commerce companies utilising deliveries,
enabling them to more effectively manage their
demand by supplementing their own fleet
with third party fleets and Ryde’s own fleet.
£1 MILLION INVESTED
SonicJobs is an application-based job search
platform specialising in roles in blue collar industries
including hospitality, retail, beauty, logistics, health
and social care. SonicJobs differentiates itself from
other job sites with the ease with which a candidate
can apply for a role on their platform. Through a
conversational chat bot, SonicJobs receives standard
information from applicants for each role and saves
this information to make it easy to apply to multiple
roles, maximising candidates’ chances of receiving
an offer.
£450K INVESTED
Venture Fund
StepEx is the first FCA authorised financial
institution providing “Future Earning Agreements”
(FEAs). FEAs are an alternative to term loans and
are a credit instrument where the
“
borrower
” pays
a portion of their future earnings for a fixed period
to the “lender”
. London Business School, INSEAD,
Makers Academy and General Assembly are
StepEx clients, as are a number of other education
providers, who see this as a marketing tool to sell
extra courses.
£499K INVESTED
Nook’s platform creates a “shared ledger” between suppliers and
buyers by integrating their accounting software and using the open
banking API to verify sending and receipt of payments. This two-
way syncing of ledgers minimises manual data entry and eliminates
PDF documents being sent via email, making the verification, and
payment of invoices faster, cheaper, and
less prone to fraud.
The platform enables suppliers and buyers to communicate and
edit “invoices”
via the shared ledger without having to send,
change and resend PDFs and aims to automate the workflows in
Accounts Payable and Receivable out of existence.
£250K INVESTED
Superlayer
has a sales solution which allows sales departments to
make the most of the data in their existing CRM / sales stack without
writing code or the need for business analysts. Much of the existing
data is “
stuck
”
in CRM systems which means that granular sales data
is not always easy to access.
Superlayer provides dashboards and
graphs out of the box, highlighting the pertinent information and
insights, giving access to best-in-class revenue operations
analytics.
£224K INVESTED
10 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
CHAIR’S STATEMENT
Tickitto is building a universal API for tickets to
events and experiences, with the goal of becoming
the rails that the distribution of tickets runs on,
representing a $4.8bn revenue opportunity over the
next five years. With a few lines of code, developers
can integrate and go live using Tickitto within a few
hours versus building all the integrations themselves.
£1 MILLION INVESTED
Pixie’s process automation software for small accountancy practices provides
accountants with best
-in-
class workflows for the Business As Usual (BAU)
processes that they need to run on behalf of their clients. Pixie makes small
accountancy firms much more efficient by allowing them to work from one
system with pre-created workflows, auto-populated calendars, automatic
emails to collect documents from clients, third-party apps directly embedded
into workflows, automatic logging of client emails and maintaining the system
of records.
£915K INVESTED
Anorak is an FCA regulated online adviser broker
reinventing the life insurance distribution model. Lack of
scalable distribution is credited with being part of the
problem with the current model, as life insurance policies
are predominantly
sold via IFAs and brokers as online
price comparison sites are not able to provide the advice
consumers require. For example, a consumer can purchase
car or travel insurance from a range of providers through an
online broker such as Moneysupermarket.com, but they are
not able to purchase life insurance except from tied agents.
Anorak is attempting to tackle this problem and become the
Moneysupermarket.com of the life insurance industry.
£700K INVESTED
Knok Healthcare is a telemedicine solution that provides
virtual consultations through a combination of triage,
scheduling, record keeping, and integration with healthcare
providers. Knok Healthcare’s product, Panacea, aims to be
the reference white label provider for virtual consultations.
Panacea incorporates clinical support, for both patient and
clinician which integrate seamlessly into the existing patient
journey and connects with enterprise systems. Knok’s mission
is to contribute to universal access to healthcare, connecting
doctors and patients through easy-to-use technology.
£513K INVESTED
Seedata provides assurance to a company’s existing
cybersecurity suite, by creating honeypots for attackers by
planting trackable data records (seeds) into the databases,
emails and Customer Relationship Management systems
(CRMs) of its clients via APIs (interfaces between software
systems). These seeds then monitor for any evidence of
that data having been stolen. The seeds are replaced
regularly in order to create a time stamp to determine the
date of the breach and the client can choose to replace
the seeds daily, weekly or monthly. The seeds can be
planted manually by the customer or in an automated
fashion via the Seedata platform. The automated platform
requires a few hours of set up time the first time it is used.
£150K INVESTED
Learnerbly is the provider of a learning
and development software platform, sold
to corporates on a software-as-a-service
basis. Customers include Onfido, King,
Tide, Curve, Snyk, ComplyAdvantage,
GoCardless, Freetrade and others.
£200K INVESTED
Triple Point VCT 2011 plc
| 11
STRATEGIC REPORT
CHAIR’S STATEMENT
In July 2021 Shareholders voted to approve the
recommendation of the Board and the Investment
Manager to dispose of certain of the Hydro Assets
which formed the majority of investments held by the A
Share Class. Following a competitive bidding process
these investments were sold at a price of £4,245,725
which represented 97.5% of their carrying value. Further
details on the sale process are set out in the Investment
Manager’s Review on page 38 below.
As a result of the difference between the sale price and
carrying value, together with a small write-down of the
investment in Green Highland Shenval Limited, and
payment of the performance fee due to the Investment
Manager, the A Share Class has recorded a loss over the
period of 2.71 pence per share.
Following the disposal of the Hydro Assets, a dividend
of 33 pence per share was paid to the A Class
Shareholders. A core target of the share class was to
deliver a cash return to investors, including the initial tax
relief of 100 pence per share by the end of year six.
The
aggregate of those dividends, the June 2021 dividend
of 3.5 pence per share, and the dividend following
disposal paid in December 2021, is 106.5 pence per
share.
As at the period end the A Share Class held investments
in Broadpoint 3 Limited and Green Highland Shenval
Limited and recorded a NAV of 13.25 pence per share
5
.
Since the year end, the investment in Broadpoint 3 has
been realised at its balance sheet valuation.
The Company is continuing to explore its options to
dispose of its minority interest in Shenval, although it
is expected that such a sale will only take place once
all Shareholders in Shenval are in a position to sell,
following which net proceeds of sale will be returned to
A Shareholders. At the appropriate time, a proposal will
be put to Shareholders for the wind-up and cancellation
of the A Share Class.
5
To align its interests with Shareholders, the Investment Manager earns a
performance fee of 20% on all distributions for the A Share Class over 100
pence per share; as this fee is not payable until distributions are made, it is not
accounted in the Net Asset Value.
A Share Class
Total Dividends
Paid Per Share
106.50
PENCE
12 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
CHAIR’S STATEMENT
The B Share Class portfolio has recorded a profit
over the year of 0.31 pence per share due to income
exceeding running costs. As at 28 February 2022 the
NAV per share stood at 57.69 pence per Share.
During the year, a substantial part of the B Share Class
portfolio of Hydro Assets were sold which enabled
Broadpoint 3 Ltd (through which the B Share Class
held an interest) to repay its £1,096,103.43 loan and a
portion of the redemption premium to the Company.
Following this, the majority of the net proceeds of
the sale were returned to B Shareholders through
a 10 pence per Share dividend which was declared
on 7 March 2022. A small portion of the proceeds
have been retained to ensure that the Share class can
continue to meet all of its relevant expenditure.
Following the Hydro asset sale, the assets within the
B Share Class are two gas fired energy centre assets,
Green Peak Generation Limited (“Green Peak”)
and Distribution Generators Limited (“Distributed
Generators”). As reported in our 2021 Interim Report
there have been availability issues for the engines with
a water ingress issue at Green Peak, and we are pleased
to confirm that the fault has been resolved and the
insurers have agreed to pay the full insurance claim for
property damage and business interruption to the end
of January (the Investment Manager’s Report has further
details on pages 30 to 41).
We are working with the
Investment Manager to consider offers for the portfolio
alongside considering potential disposal options for the
remaining B Share Class assets in order to return funds
to B Shareholders.
In addition, where the Board receives excess cash
generated from the gas fired energy assets, it will
consider whether it is appropriate to declare an
additional dividend. Since mid-June 2021 the Board has
exercised its discretion not to facilitate share buybacks in
the B Share Class due to insufficient liquidity. To ensure
that we are being fair and equitable to all Shareholders,
it is our intention that any excess funds in the B portfolio
will be returned to all investors through dividends; the
Board will continue to monitor this position. At the
appropriate time, a proposal will be put to Shareholders
for the wind-up and cancellation of the B Share Class.
B Share Class
Total Dividends
Paid Per Share
10.00
PENCE
Triple Point VCT 2011 plc
| 13
STRATEGIC REPORT
CHAIR’S STATEMENT
Liquidity
The Company has sufficient liquidity, predominantly from
the Venture Fund raise, with cash and readily realisable
investments totalling £6.25 million (18% of net asset value)
at 28 February 2022. This means that the Company will be
able to react quickly to new investment opportunities for the
Venture Fund as they arise.
Share Buy-Backs
We continue to maintain our aim, subject to distributable
reserves and liquidity, of being willing to buy back the
Company’s Shares in the market at a price of 5% discount
to NAV. Since mid-June 2021 the Board has exercised
its discretion not to facilitate Share buybacks in the B
Share Class due to insufficient liquidity. To ensure that we
are being fair and equitable to all Shareholders, it is our
intention that any excess funds in the B portfolio will be
returned to all investors through dividends; the Board will
continue to monitor this position.
During the year ended 28 February 2022 a total of 173,848
A Shares, 46,556 B Shares and 252,401 Venture Shares were
repurchased by the Company for cancellation at a price of a
5% discount to NAV. The average price paid for the buy-
back of Shares were as follows:
Date
Number of
Shares
Share
Class
Average
Price
18 August 2021
105,777
Venture
103.01p
10 June 2021
173,848
A Ordinary Shares
46.48p
10 June 2021
46,556
B Ordinary Shares
54.49p
10 June 2021
146,624
Venture
96.20p
These transactions represent 1.48% of the opening issued
Share capital of the Company.
VCT Qualifying Status
The Company has maintained its approved venture capital
trust status with HM Revenue & Customs. The Company’s
compliance with the VCT qualifying conditions is closely
monitored by the Board, who receive regular reports from
the Investment Manager and a report annually from our VCT
tax compliance advisers Philip Hare & Associates LLP.
VCT Legislation and Regulation
Following continuous dialogue with HMRC the VCT industry
benefits from greater clarification around the operation
of the new VCT rules introduced in 2015. As a result, the
majority of investments are now made on the basis of self-
assuring their qualifying status, subject to the receipt of
professional advice from our Tax Advisers.
We will continue to work closely with the Investment
Manager to ensure the Company remains compliant with
the scheme rules.
Post Year End Update
Following the year-end, the Company has allotted a further
9,973,377 Shares into the Venture Fund. The Shares were
issued at the end of March and 1 April
2022; these further
allotments raised additional net proceeds of
£11.2 million
for the Company. For all future investments in the 2022/23
tax year, the offer will remain open until 29 July 2022, unless
fully subscribed at an earlier date.
Outlook
The Board are pleased to have completed the sale of a
substantial part of the Hydro Assets within the A and B
Share Class, which enabled further dividends to be paid to
A shareholders during the year and B shareholders following
the year end. It is now the Board’s aim to sell the remaining
assets within the A and B share classes as set out above,
returning the net proceeds to Shareholders, and at the
appropriate time, putting a proposal to Shareholders to
wind-up and cancel both the A and B Share Classes.
The Venture Fund has seen several uplifts in NAV, a
successful fundraise, and its first cash exit for Credit Kudos,
which was completed shortly after the year end. The Board
will continue to consider dividends for Venture Shareholders,
subject to realised profits, legislative requirements and
liquidity. I am delighted to announce that a further dividend
of 3 pence per Share will be paid on 5 September 2022 to
Venture Shareholders.
As I noted above, intense concerns about Covid-19 have
quickly morphed into concerns
about the combination of
higher inflation, higher interest rates and the Ukraine-Russia
war. Whilst the direct impact of these factors on the type of
software companies that the Venture share class invests in
are usually limited, the Investment Manager is monitoring
developments carefully, including both the impact on
investee cash flows of inflation in skilled staffing costs,
particularly in software development and digital marketing,
and the potential impact of rising bond yields on tech sector
valuations
(see Investment Manager’s Review on pages 30
to 41). Despite the current uncertainty, we believe that the
Fund’s existing portfolio remains well positioned for future
growth and that the recent successful fund raise and exit
proceeds leave the share class in a strong position to pursue
opportunities as they develop.
I would like to take this opportunity to thank Shareholders
and the Investment Manager for their continued support
and I look forward to welcoming further Venture Fund
Shareholders during the months ahead.
If you have any questions about your investment, please do
not hesitate to contact TPIM on 020 7201 8990.
Jane Owen
Chair
27 May 2022
14 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
CHAIR’S STATEMENT
Chair’s Statement
THE BOARD ARE PLEASED TO HAVE
COMPLETED ON A SALE OF A
SUBSTANTIAL PART OF THE HYDRO
ASSETS WITHIN THE A AND B SHARE
CLASS, WHICH ENABLED FURTHER
DIVIDENDS TO BE PAID DURING THE
YEAR TO A SHAREHOLDERS AND TO
B SHAREHOLDERS, FOLLOWING THE
YEAR END.
STRATEGIC REPORT
Triple Point VCT 2011 plc | 15
The Strategic Report has been prepared in accordance
with the requirements of Section 414c of the Companies
Act 2006. Its purpose is to inform the members of the
Company and help them to assess how the Directors
have performed their duty to promote the success of
the Company, in accordance with Section 172 of the
Companies Act 2006.
The Directors assess the Company’s success in meeting
its objectives in relation to returns, stability, VCT
qualification and, ultimately, exit.
Investment Policy
Investment Objectives
The Company’s Investment Policy is directed towards
new investments in businesses which either: (i) have
the potential for high growth, or (ii) are cash flow
generative businesses with a high-quality customer
base. All investments must provide the potential for a
strong, positive, risk-adjusted return to investors. All
investments will be made with the intention of growing
and developing the revenues and profitability of the
target businesses.
Venture Fund
The Company’s Venture Fund focuses on providing
funding to unquoted companies at an early stage in
their lifecycle to help them grow and scale. The Venture
Fund will typically make initial investments of between
£50,000 and £2 million and may make further follow-
on investments into existing portfolio companies.
The intention is to build a portfolio of predominantly
unquoted companies with significant growth potential
across a diversified range of sectors.
The Company will not vary these objectives to any
material extent without the approval of the Shareholders.
A & B Shares
The key objectives of the Company’s A Share Fund and
B Share Fund are to:
•
pay regular tax-free dividends to investors;
•
maintain qualifying VCT status to enable investors to
benefit from the associated tax reliefs;
•
reduce the volatility normally associated with early
stage investments by applying its Investment Policy;
•
make investments typically in the range of £500,000
to £5 million in companies with contractual revenues
from financially sound counterparties*; and
•
in respect of the B Share Fund only, provide investors
with the option to exit shortly after five years
following investment.*
*The A and B Share Classes are both fully invested and closed to new investment,
consequently the Share Classes are no longer making investments, and
will seek
realisations to enable an exit at the appropriate time.
The Company will not vary any of the above objectives
for the Venture Fund, A Share Fund or B Share Fund
to any material extent without the approval of the
Shareholders.
Target Asset Allocation
The Company aims to invest its capital fully in VCT
Qualifying Investments. Where this is not practicable,
the long-term investment profile of the Company is
expected to be:
•
at least 80% in VCT Qualifying Investments, with
a focus on unquoted companies with high growth
potential for the Venture Fund; and
•
a maximum of 20% in permitted Non-Qualifying
Investments, cash or cash-based similar liquid
investments.
Qualifying Investments
Investment decisions made must adhere to HMRC’s
VCT qualification rules. In considering a prospective
investment in a company, particular regard is given to:
•
the track record, expertise and ability of the
management team with clear commercial and
financial objectives;
•
a significant, often global, total addressable market;
•
the ability of the company to create and sustain a
competitive advantage;
•
the quality of the company’s assets, in particular
where appropriate, the ownership and effective
use of proprietary technology and/or an innovative
product;
•
the high likelihood of a transformational corporate
contract and established market fit and then the
opportunity to develop regular, repeated income
from new clients, leading to growth and long-term
profitability;
•
a high level of access to regular material financial
and other information during the holding period;
•
an attractive valuation at the time of the investment;
•
the long-term prospect of being sold or listed in
the future at a significant multiple of the initial
investment value; and
STRATEGY AND
BUSINESS MODEL
16 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
•
in respect of the B Share Fund, the prospect of
achieving an exit after five years of the life of the
fund.
In respect of the Venture Fund, no more than 10% of the
NAV of the Venture Fund (at the point of the investment),
will be invested in companies which are not revenue-
generating or where there is no expectation of revenues
being generated in the near future.
As the value of investments increase, Triple Point will
monitor opportunities for the Company to realise
capital gains to enable the Company to make tax-free
distributions to Shareholders.
Non-Qualifying Investments
The Non-Qualifying Investments will be managed with
the intention of generating a positive return. The Non-
Qualifying Investments will comprise from time to time
a variety of assets including (a) short-term deposits of
money, Shares or units in alternative investment funds
(which have the meaning given by regulation 3 of the
Alternative Investment Fund Managers Regulations
2013) or in undertakings for the collective investment in
transferable securities (which have the meaning given
by Section 363A(4) of the Taxation (International and
Other Provisions) Act 2010), which may be repurchased,
redeemed, or paid out on no more than seven days’
notice; and (b) ordinary Shares or securities in a company
which are acquired on a regulated market (defined in
Section S274(4) ITA 2007).
Borrowing Powers
Any borrowing by the Company for the purposes of
making investments will be in accordance with the
Company’s articles of association. To the extent that
borrowing is required, the Directors will restrict the
borrowings of the Company and exercise all voting
and other rights or powers of control over its subsidiary
undertakings (if any) to ensure that the aggregate
amount of money borrowed by the Company, being the
Company and any subsidiary undertakings for the time
being (excluding intra-Company borrowings), will not,
without Shareholder approval, exceed 30% of its NAV at
the time of any borrowing.
Risk Diversification
The Company aims to invest in a number of different
businesses within a variety of industry sectors but may
focus investments in a single sector where appropriate
to do so. No single investment by the Company will
represent more than 15% of the aggregate NAV of the
Company at the time the investment is made.
Valuation Policy
All unquoted investments will be valued in accordance
with International Private Equity & Venture Capital
(IPEV) or similar guidelines. A brief summary of the
IPEV guidelines as it applies to TP11’s investments is as
follows:
•
investments should be reported at fair value where
this can be reliably determined by the Board on the
recommendation of the Investment Manager.
•
in estimating fair value for an investment, the
valuation methodology applied should be the
most appropriate for a particular investment.
Such methodologies, including the price of
the recent investment, earnings multiples, net
assets, discounted cash flows or earnings and
industry valuation benchmarks, should be applied
consistently. The price of recent transactions should
not be assumed and should be calibrated against a
scorecard or other appropriate measures.
•
where the valuation is based on the price of a
recent investment this may be adjusted to reflect
subsequent business performance and variations
from expectations at the time of investment.
Co-Investment Policy
The Company may invest alongside other funds or
entities managed or advised by the Investment Manager
which would help the Company to broaden its range of
investments or the scale of opportunities more than if it
were investing on its own.
It is possible that conflicts may arise in these
circumstances between different funds or between the
Company and the Investment Manager. The Investment
Manager maintains robust conflict of interest procedures
to manage potential conflicts and issues are resolved
at the discretion of the independent board of the
Company.
Dividend Policy
The Company will distribute by way of dividend such
amount as ensures that it retains not more than 15%
of its income from Shares and securities. The Directors
aim to maximise tax-free distributions to Shareholders
of income or realised gains. It is envisaged that the
Company will distribute most of its net income each year
by way of dividend, subject to liquidity.
Triple Point VCT 2011 plc
| 17
STRATEGIC REPORT
STRATEGY AND BUSINESS MODEL
For the Venture Fund, the Company intends to distribute
regular dividends of up to 5 pence per Venture Share
per annum thereafter. The Company’s ability to pay
dividends is subject to the existence of realised profits,
legislative requirements, and the available cash reserves.
Share Buy-Back Policy
TP11 aims, but is not committed, to offer liquidity to
Shareholders through on-going buy-backs, subject to the
availability of distributable reserves, at a target price of
a 5% discount to net asset value. Since mid-June 2021
the Board has exercised its discretion not to facilitate
Share buybacks in the B Share Class due to insufficient
liquidity. To ensure that we are being fair and equitable
to all Shareholders, it is our intention that any excess
funds in the B portfolio will be returned to all investors
through dividends; the Board will continue to monitor
this position.
Share Realisation Policy
After an anticipated holding period of between five and
seven years, which may include follow-on investments
into investee companies as appropriate, Triple Point
intends to identify opportunities to exit Venture Fund
investments.
Exits will typically be realised through trade sales to
businesses, acquisitions by private equity funds, or
selling shareholdings to later stage venture and growth
capital funds during the course of further investee
company fund raising activity. Sales during the course
of further investee company fund raising activity may
include investee companies buying back Shares at
a price reflecting the valuation at that stage. The
proceeds of any realisation will be used to identify
further investment opportunities and to pay dividends to
investors.
Key Performance Indicators (“KPIs”)
As a VCT, the Company’s objectives are to provide
Shareholders with up front tax relief, an attractive
income and returns through capital appreciation and the
payment of dividends. The Company aims to meet these
criteria by investing its funds in line with the Company’s
investment policy, more detail of which can be found on
pages 16 to 17.
The Board expects the Investment Manager to deliver a
performance which meets the objectives of providing
investors with an attractive income and capital return.
The Board has identified four primary KPIs, which are
increase in NAV, total return, earnings per share and
ongoing charges ratio, that it uses in its own assessment
of the Company’s performance, set out below.
These are intended to provide Shareholders with
sufficient information to assess how the Company
has performed against its objectives in the year to 28
February 2022, and over the longer term, through the
application of its investment and other principal policies.
Total Return
NAV plus dividends paid is a measure of Shareholder
value that includes the current NAV plus cumulative
dividends paid to Shareholders to date. The charts show
how the Total Return of each Share Class has developed
since launch. Total Return is deemed an alternative
performance measure.
18 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
STRATEGY AND BUSINESS MODEL
Increase in NAV
The NAV per Venture Share has
increased from 93.26 pence
per Share at 28 February 2021
to 113.55 pence per Share at
28 February 2022, an uplift of
20.29 pence per Share. The
increase in NAV is attributable
to uplifts in investment
valuations supported by both
new investment raises at higher
valuations as well as strong
business performance.
Total Return
After making an adjustment for
dividends paid during the year
the Venture Shares total return
has increased from 96.26 pence
per Share at 28 February 2021
to 119.55 pence per Share at the
reporting date. This represents
an increase of 24.19%.
Earnings per Share
The Charts show the Company’s
earnings per Share, by Share
class for the year ended 28
February 2022. The longer-term
trend of performance on this
measure is shown in the charts.
Total Return Venture Share Class
Earnings Per Share Venture Share Class
99.01
93.26
3.00
113.55
6.00
80.00
85.00
90.00
95.00
100.00
105.00
110.00
115.00
120.00
125.00
29-Feb-20
28-Feb-21
28-Feb-22
Venture Shares
Cumulative dividends
(2.17p)
(4.26p)
(1.25p)
(0.04p)
1.01p
29-Feb-20
28-Feb-21
28-Feb-22
Revenue
Capital
(5.00p)
-
5.00p
10.00p
15.00p
20.00p
25.00p
30.00p
26.84p
Venture Fund
Triple Point VCT 2011 plc
| 19
STRATEGIC REPORT
STRATEGY AND BUSINESS MODEL
Increase in NAV
The NAV per A Share has
decreased by 39.18 pence per
Share at 28 February 2021 to
13.25 pence per Share
6
at the
reporting date. The NAV of the
A Share Class decreased due
to the payment of dividends to
A Class Shareholders , totalling
36.50 pence per Share in the
period out of the proceeds
from the Hydro sale, and the
management performance fee,
for a successful return of capital
to Shareholders.
Total Return
The A Shares total return has
decreased from 122.43 pence
per Share at 28 February 2021
to 119.75 pence per Share
at the reporting date. This is
largely due to the sale of Hydro
assets being sold at less than
their carrying value causing a
loss on disposal.
Earnings per Share
The Charts show the Company’s
earnings per Share, by Share
class for the year ended 28
February 2022. The longer-term
trend of performance on this
measure is shown in the charts.
6
To align its interests with Shareholders, the
Investment Manager earns a performance fee
of 20% on all distributions over 100 pence per
share; as such fee is not payable until
distributions are made, it is not accounted in
the Net Asset Value.
Total Return A Share Class
Earnings Per Share A Share Class
100.54
104.07
106.90
4.00
110.49
7.75
57.78
63.25
52.43
70.00
106.50
13.25
40.00
50.00
60.00
70.00
80.00
90.00
100.00
110.00
120.00
130.00
29-Feb-16
28-Feb-17
28-Feb-18
28-Feb-19
29-Feb-20
28-Feb-21
28-Feb-22
NAV per share
Cumulative dividends
1.49p
(0.29p)
3.61p
(0.08p)
4.44p
2.39p
3.39p
3.95p
2.03p
0.77p
1.62p
(0.22p)
0.46p
(3.17p)
(4.00p)
(2.00p)
-
2.00p
4.00p
6.00p
8.00p
29-Feb-16
28-Feb-17
28-Feb-18
28-Feb-19
29-Feb-20
28-Feb-21
28-Feb-22
Revenue
Capital
A Share Class
20 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
STRATEGY AND BUSINESS MODEL
Increase in NAV
The NAV per B Share has
increased from 57.36 pence per
Share at 28 February 2021 to
57.69 pence per Share at
28 February 2022. This
represents an increase of
0.58%. The increase in NAV
is attributable to receiving
proceeds from the Hydro sale.
Total Return
The B Shares total return has
increased from 67.36 pence
per share at 28 February 2021
to 67.69 pence per share at
28 February 2022.
TPIM agreed not to charge
their management fees from
1 January 2017 on the amounts
invested in gas fired energy
assets, until these investments
started to generate income.
These fees continue not to be
accrued. The total fee waived
to date for the B Share Class is
£745,300.
Earnings per Share
The Charts show the Company’s
earnings per Share, by Share
class for the year ended 28
February 2022. The longer-term
trend of performance on this
measure is shown in the charts.
Total Return B Share Class
99.76
100.00
106.10
102.77
5.00
57.36
10.00
57.69
10.00
40.00
50.00
60.00
70.00
80.00
90.00
100.00
110.00
120.00
28-Feb-17
28-Feb-18
28-Feb-19
29-Feb-20
28-Feb-21
28-Feb-22
NAV per share
Cumulative dividends
Earnings Per Share B Share Class
(0.37p)
(0.04p)
0.10p
(0.01p)
0.26p
(0.09p)
6.19p
0.69p
–
(1.36p)
(1.04p)
(39.05p)
(40.00p)
(30.00p)
(20.00p)
(10.00p)
-
10.00p
28-Feb-17
28-Feb-18
28-Feb-19
29-Feb-20
28-Feb-21
28-Feb-22
Revenue
Capital
1.35p
(0.02p) (0.05p)
(0.06p)
(0.60p)
(0.09p)
(0.05p)
(0.18p)
B Share Class
Triple Point VCT 2011 plc
| 21
STRATEGIC REPORT
STRATEGY AND BUSINESS MODEL
7
This ratio is calculated using the AIC’s “Ongoing Charges” methodology which can be found on its website https://www.theaic.co.uk/.
The
Ongoing Charges ratio is deemed an alternative performance measure.
Ongoing charges ratio
The ongoing charges ratio
7
is a ratio of annualised
ongoing charges expressed as a percentage of the
average net asset value throughout the period. The
annual running costs of the Company are capped at 3.5%
of the Company’s NAV, above which, the Investment
Manager will bear any excess costs.
The ongoing charges of the Company for the financial
year under review represented 2.94% (2021: 3.03%) of the
average net assets.
Compliance with VCT legislation
By making an investment in a Venture Capital Trust,
Shareholders become eligible for several tax benefits
under VCT tax legislation. This is, however, contingent
on the Company complying with VCT tax legislation.
The Board can confirm that throughout the year ended
28 February 2022, the Company continued to meet
these tests.
To achieve compliance, the Company must meet a
number of tests set by HMRC. A summary of these steps
is set out on page 70 under “VCT Regulation”.
Tax Benefits
The Company’s objective is to provide Shareholders with an
attractive income and capital return by investing its funds in
a broad spread of unlisted UK companies which meet the
relevant criteria for investment by Venture Capital Trusts.
Investing in a VCT brings the benefit of tax-free
dividends, as well as up-front income tax relief. The
Company continues to meet the VCT qualification
requirements which are continuously monitored by the
Investment Manager and reviewed by the Directors.
Investment classification by asset value and sector value
are shown on the next page:
VCT Regulation
VCTs were first introduced in the Finance Act 1995
to provide a means for private individuals to invest in
unquoted companies in the UK. The Finance Act 2004
introduced changes to VCT legislation designed to
make VCTs more attractive to investors. The current tax
benefits available to eligible investors in VCTs include:
•
up-front income tax relief of 30% on a maximum
investment of £200,000 per tax year on newly issued
Shares;
•
exemption from income tax on dividends received;
and
•
exemption from capital gains tax on disposals of
Shares in VCTs.
Since the Finance Act 2004, the VCT rules have
subsequently been amended under the Finance Act
2014 and The Finance (No 2) Act 2015. The Investment
Manager, utilising advice from Philip Hare & Associates LLP,
ensures continued compliance with any legislative changes.
The Company will continue to ensure its compliance with
the qualification requirements.
The Company has been approved as a VCT by Her
Majesty’s Revenue and Customs. To maintain this approval,
the Company must comply with certain requirements
on a continuing basis. Prior rules for earlier investments
had lower limits, however the current limits require that
within three years from the effective date of provisional
approval or later allotment at least 80% of the Company’s
investments must comprise qualifying holdings. For
accounting periods ending on or after 6 April 2018, 70% of
these investments must be in eligible Ordinary Shares in all
cases. This investment criterion continues to be met.
22 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
STRATEGY AND BUSINESS MODEL
Investment by Sector
Investment by Sector
Investment by Sector
A Share Class
B Share Class
Venture Fund
Investment Portfolio
Investment Portfolio
** Please note that the percentage of qualifying investments in the above graphs are not representative of the Company as a whole. Under current
VCT regulations the Company has three years before undeployed cash counts towards the qualifying status of the Company. Undeployed cash is
therefore not taken into account in determining the Current Qualifying status percentage of the Company, which at the year-end was above 80%.
VCT Qualifying
Investments
VCT Non-Qualifying
Investments
Cash
45%
19%
36%
Hydroelectric Power
70%
30%
SME Funding
Hydroelectric
Power
VCT Qualifying
Investments
VCT Non-Qualifying
Investments
Cash
74%
27%
-1%
Gas Power
SME Funding
Hydroelectric
Power
73%
27%
VCT Qualifying
Investments
VCT Non-Qualifying
Investments
Cash
80%
1%
19%
3%
1%
2%
2%
Fintech
Middleware
Health
Logistics
Insuretech
Proptech
Cyber Security
HR
RevOps
Education
Content & Design
SME Funding – Other
35%
17%
18%
7%
5%
6%
STRATEGY AND BUSINESS MODEL
Investment Portfolio
Triple Point VCT 2011 plc
| 23
STRATEGIC REPORT
FCA Regulation
On 22 July 2014 Triple Point VCT 2011 plc registered
with the Financial Conduct Authority as a small
Alternative Investment Fund Manager (“AIFM”) under
the AIFM Directive.
Exit Programme
The Company and Investment Manager continue to
be committed to ensuring a timely exit and return of
funds to B Class Shareholders as soon as practicable.
The Investment Manager has a strong track record in
managing such exits.
Although the initial mandate for the A Share Class was
to hold the hydro investments for up to 16 years, the
Board put forward a proposal to proceed with a disposal
of the A Share Class Assets, following which a substantial
part of the Hydro Assets has been sold. The Board are
continuing to consider potential disposal options of its
remaining interest in Shenval; please refer to the Chair’s
Statement on pages 7 to 15 and Investment Manager’s
Review on pages 30 to 41 for further information.
Principal Risks and Uncertainties and
Emerging Risks
The Directors seek to mitigate its principal risks by
regularly reviewing performance and monitoring
progress and compliance. In the mitigation and
management of these risks, the Directors carry out a
robust assessment of the Company’s emerging and
principal risks, including those that would threaten its
business model, future performance, solvency or liquidity
and reputation.
The main areas of risk identified by them, along with
the risks to which the Company is exposed through its
operational and investing activities, are detailed below.
The Board maintains a comprehensive risk register which
sets out the risks affecting both the Company and the
investee companies in which it is invested. The risk
register is updated at least twice a year and reviewed
by the Audit Committee to ensure that procedures are
in place to identify principal risks and to mitigate and
minimise the impact of those risks should they crystallise.
The risk register is also reviewed and updated to identify
emerging risks, such as any climate related risks, and
to determine whether any actions are required. This
enables the Board to carry out a robust assessment of
the risks facing the Company, including those risks that
would threaten its business model, future performance,
solvency or liquidity. As it is not possible to eliminate
risks completely, the purpose of the Company’s risk
management policies and procedures is to identify and
manage risks, reducing possible adverse impacts.
The Company does not consider Brexit to continue to
be a principal or emerging risk as the Company invests
into UK-based companies insulating it from any potential
future deals negotiated with the EU, and because of
the certainty from the Brexit deal reached at the end
of 2020. The Company has removed the Covid-19 risk
due to the transition to “living with Covid-19”, the
government’s plan which has lifted restrictions and
therefore its consequential impact on the economy.
Details of the Company’s internal controls are contained
in the Corporate Governance section on pages 56 to 57
and further information on exposure to risks including
those associated with financial instruments is given in
note 17 of the financial statements.
VCT Qualifying Status Risk
The Company is always required to observe the
conditions laid down in the Income Tax Act 2007
for the maintenance of approved VCT status. The
loss of such approval could lead to the Company
losing its exemption from corporation tax on capital
gains, to investors being liable to pay income tax on
dividends received from the Company and, in certain
circumstances, to investors being required to repay the
initial income tax relief on their investment.
Mitigation:
The Investment Manager keeps the
Company’s VCT qualifying status under continual review
and reports to the Board at Board Meetings. The Board
has appointed Philip Hare & Associates LLP to undertake
an independent VCT status monitoring role. Any new
Venture investments are reviewed by legal advisers, and
their opinion sought on whether the investment is likely
to be a qualifying investment.
Investment Risk
The Company’s VCT qualifying investments will be held
in small and medium-sized unquoted investments which,
by their nature, entail a higher level of risk and lower
liquidity than investments in large, quoted companies.
This could make it difficult to realise investments in line
with the relevant strategy.
Mitigation:
The Directors and Investment Manager
aim to limit the risk attached to the portfolio by careful
selection and timely realisation of investments, by
carrying out rigorous due diligence procedures and by
maintaining a spread of holdings in terms of industry
sector and geographical location. The Board reviews
the investment portfolio with the Investment Manager
on a regular basis. Where possible, a member of the
Investment Manager team holds a seat on the board of
the portfolio companies. This enables the Investment
Manager to observe and offer guidance to the portfolio
company when and where this may be required. TPIM
has developed a wide industry network and strong
STRATEGY AND BUSINESS MODEL
24 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
pipeline which is reviewed quarterly by the Board. The
Venture Fund aims to mitigate some of the risks typically
associated with venture capital investing by proactively
working with businesses with the potential for high
growth that are actively solving problems for established
corporates, increasing their chances of success, as set
out in further detail on pages 32 to 37.
Financial Risk
As a VCT the Company is exposed to market price risk,
credit risk, fair value risk, liquidity risk, inflation risk and
interest rate risk. As most of the Company’s investments
will involve a medium to long-term commitment and
will be relatively illiquid, the Directors consider that
it is inappropriate to finance the Company’s activities
through borrowing, other than for short-term liquidity.
Mitigation:
The key elements of financial risk are
discussed in more detail in note 17. At the reporting
date, the Company had no borrowings and substantial
cash on the balance sheet.
Failure of Internal Controls Risk
The Board regularly reviews the system of internal
controls, both financial and non-financial, operated by the
Company and the Investment Manager. These include
controls designed to ensure that the Company’s assets
are safeguarded and that proper accounting records are
maintained.
Mitigation:
The Board maintains a risk register which sets
out the risks affecting both the Company and the investee
companies in which the Company is invested. This risk
register is reviewed and updated at least twice a year to
ensure that procedures are in place to identify the principal
risks which may affect the Company and its portfolio
companies, mitigate, and minimise the impact of those
risks should they crystallise and to identify emerging risks
and to determine whether any actions are required. This
enables the Board to carry out a robust assessment of the
risks facing the Company, including those risks that would
threaten its business model, future performance, solvency
or liquidity and reputation.
Emerging Risks
Climate Change and related legislation
Taking into account the potential impact of climate
change and any related legislation which may be enacted
in respect of meeting the UK’s climate change targets, an
assessment of the key risks for each share class has been
considered.
If a change in Government renewable energy policy were
applied retrospectively to current operating projects
including those in the A Share Class this could adversely
impact the market price for the Hydro Assets or the
value of the green benefits earned from generating
renewable energy. Further, performance of the remaining
Hydro Assets may be adversely affected by lower or
more concentrated rainfall in Scotland. Nevertheless,
the Hydro Assets continue to perform well, and as such
performance will continue to be monitored closely. In
respect of the B Share Class, whilst increased penetration
of battery energy storage systems may lead to increased
competition with gas fired energy centre assets in the
flexible generation market, they have the advantage of
not having to be charged so may be likely to still have
its place from a security of supply perspective. Related
climate change policy risk may include increased carbon
costs such as potential removal of the UK ETS exemption
that both gas fired energy centre assets currently benefit
from (by way of being below the 20MWth capacity
threshold).
As the Company has sold a substantial part of its Hydro
Assets and is exploring disposal options for the gas-fired
energy centre assets, the emerging risk of climate change
and related legislation has somewhat reduced. Climate
Change or related legislation is unlikely to have a major
impact on the Venture Share Class by the nature of its
investments and diversification of its portfolio.
Ukraine-Russia War (new)
In late February 2022, Russia began an invasion of
Ukraine with devastating consequences for the country’s
citizens and major implications for wider humanity, the
global economy and capital markets. The Company
does not have any direct exposure to Russia, however,
the Company is monitoring the potential wider
macroeconomic consequences on the Company and
its investee companies closely, including energy price
volatility and further sanctions. Please refer to pages 30
to 41 of the Investment Managers review, which illustrates
the wider effects of the Ukraine-Russia war on the
Company and its investments.
Going Concern
The Company’s business activities, together with
the factors likely to affect its future development,
performance and position, are set out in the Investment
Manager’s Review. The Company faces a number of risks
and uncertainties, as set out above.
The Company’s going concern position is discussed
in more detail in note 2 to the financial statements.
The Directors have a reasonable expectation that
the Company has adequate resources to continue in
operational existence for the next five years. Accordingly,
they continue to adopt the going concern basis in
preparing the financial statements.
STRATEGY AND BUSINESS MODEL
Triple Point VCT 2011 plc
| 25
STRATEGIC REPORT
The Financial Risk Management objectives and policies
of the Company, including exposure to price risk, interest
rate risk, credit risk and liquidity risk are discussed in
note 17 to the financial statements.
The Company continues to meet day-to-day liquidity
needs through its cash resources and income from its
investment portfolio. The Company’s revenue comes
predominantly from its remaining A Share Class
investment in Shenval. The revenue is contractual, with
inflation linked FiT income and Export income from a
recently signed 12-month PPA. We have experienced
minimal disruption to these revenue streams as a result
of Covid-19. The Company also continues to raise funds
into the Venture Share Class and at the reporting date
the Company had cash of £5.34 million. A further £11.2
million has been raised since the reporting date. This
cash is more than sufficient to enable the Company to
continue as a going concern for the foreseeable future.
The Company had net current assets of £5.24 million
(2021: £5.49 million) and had cash balances of £6.25
million (2021: £5.45 million) (this does not include cash
balances held within investee companies), which are
sufficient to meet current obligations as they fall due.
The Company has subsequently raised circa £11.2
million post year end considerably increasing the
Company’s cash runway.
The major cash outflows of the Company continue to be
the payment of dividends to Shareholders, costs relating
to the acquisition of new assets, and management fees
due to the Investment Manager. With dividends and
acquisition costs being discretionary, in a time of stress,
the Investment Manager may allow the Company to
defer payment of management fees.
The Directors have reviewed cash flow projections which
cover a period of at least 12 months from the date of
approval of this report, which show that the Company
has sufficient financial resources to continue in operation
for at least the next 5 years. Accordingly, the Directors
continue to adopt the going concern basis in preparing
the financial statements.
Viability Statement
The AIC’s Code of Corporate Governance requires
the Board to assess the Company’s viability over an
appropriate period, the Directors have assessed the
prospect of the Company over a longer period than
12 months required by the Going Concern provision.
The Board conducted this review for a period of five
years, which was considered to be an appropriate time
horizon, as investors in VCTs are required to hold their
investment for a period of five years in order to benefit
from the associated tax reliefs.
The Board has determined that five years up to 28 February
2027, is the maximum timescale over which the future
position of the Company can be forecast with a material
degree of accuracy and therefore is the appropriate period
over which to consider the viability.
In order to assess this requirement, the Board regularly
considers the Company’s strategy and considers the
Company’s current position. The Board has carried out
a robust assessment of the principal and emerging risks,
including those that would threaten the Company’s
business model, future performance, solvency or liquidity
and reputation. Consideration has also been given to the
Company’s reliance on, and close working relationship with,
the Investment Manager. This has enabled the Directors
to state that they have a reasonable expectation that
the Company will be able to continue in operation and
meet its liabilities as they fall due over the period of their
assessment.
The Board has considered both the Company’s long-term
and short-term cash flow projections and considers these to
be realistic and reasonable.
More information on the principal risks of the Company is
set out on pages 24 to 25.
To provide this assessment the Board has considered
the Company’s financial position and ability to meet its
expenses as they fall due as well as considering longer-term
viability:
•
the expenses of the Company are predictable and
modest in comparison with the assets and there are no
capital commitments foreseen which would alter that
position;
•
the Company has no employees, only Non-
Executive Directors, and consequently does not have
redundancy or other employment related liabilities or
responsibilities;
•
most of the Company’s investments will involve a
medium to long-term commitment and will be relatively
illiquid but the Board reduces the risk as a whole by
careful selection and timely realisation of investments;
•
the Directors will continue to monitor closely changes in
the VCT legislation and adapt to any changes to ensure
the Company maintains approval. The Directors have
appointed an independent adviser to undertake the
VCT status monitoring role; and
•
the Directors have considered the ongoing and future
effects of the Covid-19 pandemic and the Ukraine-
Russia war on the Company and its longer-term viability.
More detail on this is included in the Principal Risks and
Uncertainties section on pages 22 to 25.
Based on the results of this review, the Directors have a
reasonable expectation that the Company will be able to
continue its operations and meet its expenses and liabilities
as they fall due over the period of their assessment.
STRATEGY AND BUSINESS MODEL
26 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
Section 172(1) Statement
The following disclosure describes how the Directors have had regard to the matters set out in Section 172(1)(a) to (f)
when performing their duty under Section 172 and forms the directors’ statement required under Section 414CZA of
the Act.
This section describes how the Board engages with its key stakeholders, and how it considers their interests when
making its decisions. Further, it demonstrates how the Board takes into consideration the long-term impact of its
decisions, and its desire to maintain a reputation for high standards of business conduct.
Stakeholder Engagement
This section describes how the Board engages with its key stakeholders, how it considers their interests and the
outcome of the engagement when making its decisions, the likely consequences of any decision in the long-term,
and further ensures that it maintains a reputation for high standards of business conduct.
Stakeholder
Importance
Board Engagement
Shareholders
Continued
Shareholder support
is critical to the
sustainability of the
Company and the
delivery of its strategy.
The Board is committed to maintaining open channels of
communication with Shareholders.
Formal updates are provided to Shareholders on a quarterly basis
or as part of the Annual or Interim Reports, and the Board and
the Investment Manager will also respond to any written queries
made by Shareholders during the course of the year.
The Chair
provides feedback to the Board and is responsible for providing
a clear understanding of the views of Shareholders to the Board.
The Board recognises the importance of providing strong financial
returns to Shareholders and the eligible tax benefits under VCT
tax legislation and takes this into consideration when making
investments into and from investee companies, approving offers
for subscription and declaring dividends.
Annual General Meeting (“AGM”) and General Meetings (“GM”)
The Board continues to engage with Shareholders through its
Annual and Interim Reports, RNS communications, and encourages
Shareholders to attend AGMs where possible.
The Board further engages with Shareholders to understand their
views on particular items that impact the Company’s strategy,
which during the year included an additional A Share Class
Meeting that took place to consult Shareholders on disposal of the
remaining A Share Class assets.
Investment Manager
The Investment
Manager’s
performance is critical
to the Company
to enable it to
successfully deliver its
investment strategy
and meet its long-
term investment
objectives of capital
growth and tax-free
dividends.
The Board has delegated the authority for the day-to-day running of
the Company to the Investment Manager. The Board then engages
with the Investment Manager in reviewing, setting, approving and
overseeing the execution of the Investment Policy and strategy of the
Company.
The Investment Manager attends both Board and other committee
meetings to update the Board on the performance of the Company
and its portfolio. At each quarterly Board meeting, a review of financial
and operating performance of the Company and its investments is
undertaken, including a review of legal and regulatory compliance.
The Board also reviews other areas including the Company’s strategy;
key risks; corporate responsibility; compliance and legal matters.
STRATEGY AND BUSINESS MODEL
Triple Point VCT 2011 plc
| 27
STRATEGIC REPORT
Stakeholder
Importance
Board Engagement
Investee companies
The Company via its
Investment Manager
has important
relationships
with individuals
responsible for the
maintenance and
performance of its
investee companies.
As part of achieving
its investment
objectives, the
Company may
provide debt
funding to investee
Companies and so
may have debtor
relationships.
For Venture investments, we maintain regular contact with Venture
portfolio companies, and where appropriate, sit on the Board of
the portfolio companies. Performance reports are provided to the
investee company boards, largely on a monthly basis.
For the A and B Shares TPIM obtains monthly operational reports
from the Operation & Maintenance (“O&M”) providers. Site
visits are undertaken at least annually by representatives from the
Investment Manager including the Investor Directors and portfolio
management team. The Investment Manager is in regular contact
with the O&M providers. Management accounts and performance
reports are provided to the Directors of investee companies on a
quarterly basis.
External Service
Providers
To function as a
VCT with a premium
listing on the London
Stock Exchange,
the Company relies
on external service
providers for support
in meeting all relevant
obligations.
These service
providers are
fundamental to
ensuring that the
Company meets
the high standards
of conduct that the
Board sets.
The Company has a number of service providers which include
the Investment Manager and Company Secretary, Registrar, Legal
Advisers, VCT Compliance Adviser and the Auditor.
The Board has regular contact with the two main service providers,
the Investment Manager and the Company Secretary, through
quarterly Board meetings and more regular discussions with the
Board.
Community
The Directors
recognise that the
long-term success of
the Company is linked
to the success of the
communities in which
the Company, and its
investee companies,
operate.
The Board encourages the responsible investment ethos of The
Investment Manager. The Board is cognisant of the impact of the
Company’s operations and of the companies in which it invests and
believes that its investment activities have many positive benefits
beyond the returns delivered for Shareholders.
Regulators
The Company can
only operate with
the approval of its
regulators.
The Company engages an external adviser to report on its
compliance with the VCT rules.
STRATEGY AND BUSINESS MODEL
28 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
Principal Decisions
Below are the principal decisions made or approved by
the Directors during the year. In taking these decisions,
the Directors considered their duties under Section 172
of the Act. Principal decisions have been defined as
those that have a material impact to the Company and
its key stakeholders, as defined above.
Disposal of Assets
During the year, a substantial part of the Hydro Assets in
the A and B Share Classes were sold.
The decision followed engagement with A Share Class
holders at an A Share Class Meeting held on 29 July
2021 at which A Share Class holders voted over 99% in
favour of selling the hydroelectric power assets within
the A Share Class.
At the 12 July 2021 AGM, there was an overwhelming
vote in favour of the disposal of the B Share Class assets.
However, the resolution failed to carry as an insufficient
number of votes were cast.
Dividends
The Company declared dividends during the year to
A Share Class holders of 36.50 pence per share and a
Venture Share Class dividend of 3 pence per share. This
decision represented the culmination of a significant
return of net proceeds of sale to A Share Class holders,
taking total distributions to 106.50 pence per share.
Following the year-end, a dividend of 10 pence per
share was paid to B Share Class holders on 31 March
2022. Consideration was given to the reserve position of
the Company to be able to facilitate these distributions.
Investments
During the year, the Company made 11 new qualifying
Venture Fund investments and nine follow-on
investments into existing portfolio companies. The
Directors considered that each investment could
generate significant long-term capital growth for
Shareholders, whilst enabling investors to take
advantage of the substantial tax reliefs available to
investors in VCTs. When approving the proposed
acquisitions, the Board considered the exit assumptions
and valuation justification of the investee companies
in addition to considering the societal impact of each
investment. The Directors further considered the first
cash exit of Credit Kudos at an over 5x return multiple.
STRATEGY AND BUSINESS MODEL
Triple Point VCT 2011 plc
| 29
STRATEGIC REPORT
INVESTMENT
MANAGER’S
REVIEW
The unquoted investment portfolio can be analysed as follows:
Investment Manager’s Review
Industry Sector
Fintech
Middleware
Health
Logistics
Insuretech
Proptech
Cyber Security
HR
RevOps
Education
Content & Design
Electricity
Generation
SME Funding
Total Unquoted
Investments
Hydroelectric
Power
Gas Power
Hydroelectric
Power
Other*
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Investments at 1 March 2021
A Shares
–
–
–
–
–
–
–
–
–
–
–
4,887
–
–
–
4,887
B Shares
–
–
–
–
–
–
–
–
–
–
–
–
2,969
1,005
–
3,974
Venture Shares
2,437
500
1,014
650
975
1,423
700
465
–
176
150
–
–
–
485
8,975
Total Investments
2,437
500
1,014
650
975
1,423
700
465
–
176
150
4,887
2,969
1,005
485
17,836
Investments made during the period
Venture Shares
2,232
1,812
1,421
1,250
900
50
150
750
224
200
–
–
–
–
–
8,988
Total additions
2,232
1,812
1,421
1,250
900
50
150
750
224
200
–
–
–
–
–
8,988
Investments disposed of during the period
A shares
–
–
–
–
–
–
–
–
–
–
–
(4,295)
–
–
–
(4,295)
Total disposals
–
–
–
–
–
–
–
–
–
–
–
(4,295)
–
–
–
(4,295)
Investments revaluations during the period
A Shares
–
–
–
–
–
–
–
–
–
–
–
(58)
–
233
–
175
B Shares
–
–
–
–
–
–
–
–
–
–
–
–
–
91
–
91
Venture Shares
4,074
1,841
2,207
(151)
(669)
(380)
(120)
239
–
176
(30)
–
–
–
–
7,187
Total revaluations
4,074
1,841
2,207
(151)
(669)
(380)
(120)
239
–
176
(30)
(58)
–
324
–
7,453
Investments at 28 February 2021
A Shares
–
–
–
–
–
–
–
–
–
–
–
533
–
233
–
766
B Shares
–
–
–
–
–
–
–
–
–
–
–
–
2,969
1,096
–
4,065
Venture Shares
8,743
4,153
4,642
1,749
1,206
1,093
730
1,453
224
553
120
–
–
–
485
25,151
Total Investments
8,743
4,153
4,642
1,749
1,206
1,093
730
1,453
224
553
120
533
2,969
1,329
485
29,982
Unquoted
Investments %
29.16% 13.85% 15.48% 5.83%
4.02%
3.65%
2.43%
4.85%
0.75%
1.84%
0.40%
1.78%
9.90%
4.43%
1.62%
100.00%
Sector Analysis
Triple Point VCT 2011 plc
| 31
STRATEGIC REPORT
Investment Manager’s Review
We have pleasure in presenting our annual review for the
year ended 28 February 2022.
This was the third year for the Company’s Venture Fund,
and during the year we have successfully raised an
additional £11.6 million after costs. During that period we
have deployed a further £5.9 million into 11 new portfolio
companies and participated in nine follow-on funding
rounds for existing portfolio businesses. In addition we
have sold a substantial part of the Hydro Asset portfolio
in the A and B Share Class, returning the net proceeds to
Shareholders. Further information on the next steps for
the A and B Share Class assets are set out below and in
the Chair’s Statement on pages 12 to 14.
Although we were very fortunate to be able to operate
effectively with remote and home working through the
Covid-19 restrictions, we were excited to see a return to
the office for our staff to bring everyone back together
again.
Nevertheless, we saw the benefit of staff being
able to work from home, and as such, we currently
operate with employees working 50% of their time in the
office and 50% at home.
Continuing intense concerns about Covid-19 at the
start of this period have quickly morphed into concerns
around the wider macroeconomic effect of the ongoing
Ukraine-Russia war. We have been active in providing
what support we can for the Venture portfolio companies
that have developers based in countries impacted by the
conflict. There are four portfolio companies that had one
or more software development team members (often
as contractors rather than employees) based in Ukraine
when the Ukraine-Russia war began. In each case this
has been managed by being tolerant of the very difficult
situation people have found themselves in, offering
support to team members in many cases through
paying for accommodation and leveraging alternative
outsourced development resource in other locations
such as Portugal, India, Poland and the UK. Most of the
development resource based in Ukraine is now regularly
back online and back-up contingency plans have been
implemented. We are fortunate that the majority of
our revenues are recurring and therefore this limits the
impact to us, but we are monitoring developments
closely.
The net cash outflow to Shareholders for the year was
£4.2 million. However, after the year end, the Company
allotted an additional £11.2 million under the latest
Venture Fund offer for subscription, meaning that the
Company and the Venture Fund remain well capitalized
to take advantage of new investment opportunities.
Ian McLennan
Partner
Triple Point Investment Management LLP
This was the third year for
the Company’s Venture Fund,
and during the year we have
successfully raised an
additional £11.6 million
after costs
32 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
The year under review was the third for the Venture Fund.
After the challenges of the prior year, when Covid-19 and
the associated lockdowns were to the fore, the year to
February 2022 has been one of significant progress for
the share class in terms of investor returns, the size of the
Fund and capital deployment.
Importantly, the Fund’s net asset value per share rose
from 93.26 pence at the beginning of the year to 113.55
pence. This represents a total return of 119.55 pence per
share, with 6 pence per share dividends paid to date.
This was despite the overall scale of the Fund growing
considerably over the period from £14.2 million of net
assets at the start of the financial year to £30.0 million
as at 28 February 2022. Last July’s 3 pence per share
dividend payment was the second dividend for the share
class, following a similar distribution in the summer of
2020, and fulfilling intentions set out in our investor
communications.
Triple Point’s Venture team continued to make good
progress in deploying the Venture Fund’s liquidity during
the year, by completing 11 new qualifying investments
plus nine follow-on investments into a diverse range
of sectors spanning logistics management software to
telemedicine and student finance. The portfolio now
consists of 31 qualifying companies.
A year ago, we were still somewhat focused on the impact
of Covid-19 on the portfolio. The Fund benefited from
being a relatively young fund going into the Covid-19
pandemic and given the Fund’s focus on business-to-
business software innovation, there was relatively little
exposure to the sectors that were more impacted by
Covid-19 such as travel and hospitality. The change or
acceleration in some societal dynamics over the last 18
months have provided positive opportunities for some
portfolio companies. These included, for example,
Venture Share Class –
Challenge-led Approach
DURING THE YEAR, THE VENTURE
FUND HAS SEEN SEVERAL UPLIFTS
IN NAV, A SUCCESSFUL FUNDRAISE,
AND ITS FIRST CASH EXIT FOR
CREDIT KUDOS.
INVESTMENT MANAGER’S REVIEW
Triple Point VCT 2011 plc
| 33
STRATEGIC REPORT
HeyDoc, where their health sector software includes easy
facilitation of video calls for medics and remote access to
patient records, and Ably Realtime, whose solutions for
reducing data latency continued to be in strong demand
as the world went digital.
In the event, those two companies were amongst the
nine portfolio businesses that completed successful new
fundraises in the period under review, at valuations which
were higher than when the Fund had originally invested
in 2019 and 2020. Several of those funding rounds were
at significantly higher valuations; notably Ably and Quit
Genius, both of which had Series B funding rounds led by
international venture capitalists, and Vyne Technologies
which raised a Seed extension round, its second up-round
since the Venture Fund invested. The Investment Manager
believes that it will usually be in the Venture Fund’s best
interest to participate, where possible, in follow-on rounds
of investee companies which have operational momentum
and are attracting interest from new, later stage, investors,
as these three did.
Given the Venture Fund’s valuation policy these notable
portfolio successes contributed to the uplift in NAV over
the period. Also contributing was the Fund’s first cash exit
– that of open-banking credit referencing specialist Credit
Kudos for an over 5x return multiple just two years after
the investment was made. While Credit Kudos’s sale did
not complete until shortly after the period under review,
the exit looked likely before year-end and gains from it
have been included in this year-end Venture NAV.
We should also note that the uplift in NAV is net of
several fair value movements made against the valuation
of Venture Fund holdings during the year. This is largely
attributable to uplifts in Ably Real Time Ltd, Vyne
Technologies Ltd, Quit Genius and Credit Kudos which
was sold post
year-end. To reiterate a point in the Chair’s
statement, while none of the Venture Fund’s portfolio
companies have failed, the failure of some investments is
an inevitable part of venture investing.
As noted earlier, nearly all of the portfolio companies are
following a business to business (B2B) commercial model
but with a sector-agnostic view resulting in the Fund’s
portfolio being active across a range of sub-sectors.
The most active sub-sectors for deployment during the
period were Fintech, where £2.2 million was deployed,
Middleware, £1.8 million and Health-tech, £1.4 million.
At the end of the year the largest sub-sectors in terms
of portfolio value were again Fintech, Health-tech and
Middleware. Fintech is a sector where TPIM has particular
experience and the portfolio includes companies with
software addressing bank data management, SME
banking and accounting, e-commerce payments, SME
insurance and invoice settlement systems.
The Fund looks to maximise Shareholder returns by
investing in innovative early-stage businesses, typically
at the point where they have achieved some market
validation with one or more contracts secured with
a corporate customer. The core investment focus for
the Fund has thus been Seed-stage investing, which
typically involves companies that have established that
there is demand for the core product with their initial
customer base and are raising funds to drive product
and sales development that will take revenues to the
next level. Around £5 million was deployed into Seed-
stage businesses in the year. £1 million of funds was also
deployed into a spread of pre-Seed businesses, and over
£2 million into slightly later stages Series A opportunities.
As mentioned, this year was the first that two portfolio
companies had Series B stage funding rounds, which the
Venture Fund participated in with £1.4 million of funding,
Many of the businesses that the Fund invests in will
involve the use of new technology and would be classified
as “knowledge-intensive” by HMRC rules, very much the
types of innovative UK businesses that the government
wishes to see backed by VCT capital which allows
investors to benefit from substantial tax reliefs. Such
investing comes with risks to capital, some of which we
aim to mitigate by focusing investment on businesses that
are actively solving significant problems for commercial
customers. We call this the Challenge-led approach to
building a portfolio of Qualifying Investments capable of
generating significant long-term, tax-free capital growth.
A snapshot of the companies the Venture Fund has
invested into during the year is set out on pages 35 to 37.
More detail on the Challenge-led approach in action can
also be seen over the page.
INVESTMENT MANAGER’S REVIEW
Venture Share Class -
Challenge led Approach
34 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
Company
£’000
Description
Ryde
1,000
Gameplan Technology Ltd, trading as Ryde (“Ryde”) provides a fully integrated delivery management
platform combining the best of fleet management software, third party logistics software and a flexible
workforce to E-commerce companies utilising deliveries, enabling them to more effectively manage their
demand by supplementing their own fleet with third party fleets and Ryde’s own fleet.
Tickitto
1,000
Tickitto is building a universal API for tickets to events and experiences, with the goal of becoming the
rails that the distribution of tickets runs on, representing a $4.8bn revenue opportunity over the next five
years. With a few lines of code, developers can integrate and go live using Tickitto within a few hours
versus building all the integrations themselves.
Pixie
915
Pixie’s process automation software for small accountancy practices provides accountants with best-in-
class workflows for the Business As Usual (BAU) processes that they need to run on behalf of their clients.
Pixie makes small accountancy firms much more efficient by allowing them to work from one system with
pre-created workflows, auto-populated calendars, automatic emails to collect documents from clients,
third-party apps directly embedded into workflows, automatic logging of client emails and maintaining
the system of records.
Anorak
700
Anorak is an FCA regulated online adviser broker reinventing the life insurance distribution model.
Lack of scalable distribution is credited with being part of the problem with the current model, as life
insurance policies are predominantly sold via IFAs and brokers as online price comparison sites are not
able to provide the advice consumers require. For example, a consumer can purchase car or travel
insurance from a range of providers through an online broker such as Moneysupermarket.com, but
they are not able to purchase life insurance except from tied agents. Anorak is attempting to tackle this
problem and become the Moneysupermarket.com of the life insurance industry.
Knok
Healthcare
513
Knok Healthcare is a telemedicine solution that provides virtual consultations through a combination
of triage, scheduling, record keeping, and integration with healthcare providers. Knok Healthcare’s
product, Panacea, aims to be the reference white label provider for virtual consultations. Panacea
incorporates clinical support, for both patient and clinician which integrate seamlessly into the existing
patient journey and connects with enterprise systems. Knok’s mission is to contribute to universal access
to healthcare, connecting doctors and patients through easy-to-use technology.
StepEx
499
StepEx is the first FCA authorised financial institution providing “Future Earning Agreements” (FEAs).
FEAs are an alternative to term loans and are a credit instrument where the “borrower” pays a portion
of their future earnings for a fixed period to the “lender”. London Business School, INSEAD, Makers
Academy and General Assembly are StepEx clients, as are a number of other education providers, who
see this as a marketing tool to sell extra courses.
SonicJobs
450
SonicJobs is an application-based job search platform specialising in roles in blue collar industries
including hospitality, retail, beauty, logistics, health and social care. SonicJobs differentiates itself from
other job sites with the ease with which a candidate can apply for a role on their platform. Through a
conversational chat bot, SonicJobs receives standard information from applicants for each role and saves
this information to make it easy to apply to multiple roles, maximising candidates’ chances of receiving
an offer.
Nook
250
Nook’s platform creates a “shared ledger” between suppliers and buyers by integrating their
accounting software and using the open banking API to verify sending and receipt of payments. This
two-way syncing of ledgers minimises manual data entry and eliminates PDF documents being sent via
email, making the verification, and payment of invoices faster, cheaper, and less prone to fraud. The
platform enables suppliers and buyers to communicate and edit “invoices” via the shared ledger without
having to send, change and resend PDFs and aims to automate the workflows in Accounts Payable and
Receivable out of existence.
Superlayer
(Formerly
Catalyst
Technologies
Ltd)
224
Superlayer has a sales solution which allows sales departments to make the most of the data in their
existing CRM / sales stack without writing code or the need for business analysts. Much of the existing
data is “stuck” in CRM systems which means that granular sales data is not always easy to access.
Superlayer provides dashboards and graphs out of the box, highlighting the pertinent information and
insights, giving access to best-in-class revenue operations analytics.
Learnerbly
200
Learnerbly is the provider of a learning and development software platform, sold to corporates on a
software-as-a-service basis. Customers include Onfido, King, Tide, Curve, Snyk, ComplyAdvantage,
GoCardless, Freetrade and others.
Seedata
150
Seedata provides assurance to a company’s existing cybersecurity suite, by creating honeypots
for attackers by planting trackable data records (seeds) into the databases, emails and Customer
Relationship Management systems (CRMs) of its clients via APIs (interfaces between software systems).
These seeds then monitor for any evidence of that data having been stolen. The seeds are replaced
regularly in order to create a time stamp to determine the date of the breach and the client can choose
to replace the seeds daily, weekly or monthly. The seeds can be planted manually by the customer or in
an automated fashion via the Seedata platform. The automated platform requires a few hours of set up
time the first time it is used.
Triple Point VCT 2011 plc
| 35
STRATEGIC REPORT
INVESTMENT MANAGER’S REVIEW
THE STRATEGY
IN PRACTICE
Company solution
Knok offers a white-labelled SaaS video
consultation solution to insurers and
healthcare providers without the need for
these companies to change their workflow.
Knok takes care of everything from
onboarding, training, white-labelling, and the
product, Panacea, includes scheduling and
payments solutions. Panacea also has the
benefit of being able to integrate with any
legacy systems where those systems are able
to communicate with a
third-party system
through APIs.
What does the
company do?
Knok Healthcare is a telemedicine solution that
provides virtual consultations through a combination
of triage, scheduling, record keeping, and integration
with healthcare providers. Knok Healthcare’s product,
Panacea, aims to be the reference white label provider
for virtual consultations. Panacea incorporates clinical
support for both patient and clinician which integrates
seamlessly into the existing patient journey and connects
with enterprise systems. Knok’s mission is to contribute
to universal access to healthcare, connecting doctors
and patients through easy-to-use technology.
Problem being solved
Medical insurers are not set up to offer a direct
telemedicine offer, nor to do so globally. Telemedicine
providers are generally branded, local, are not able
to integrate with legacy systems, and depend on
downloading specific software. Healthcare providers
often have a network of doctors but lack the technology
to offer video consultations. They are looking for an easy
to implement video conferencing solution.
These investment case studies of current holdings illustrate the types of
future investments that the Venture Fund will make.
STRATEGIC REPORT
36 | Triple Point VCT 2011 plc
STRATEGIC REPORT
INVESTMENT MANAGER’S REVIEW
Company solution
Ryde helps businesses of any size seamlessly
blend internal and outsourced delivery
workforces. Its solution includes a fully
integrated platform that allows delivery
companies to onboard and verify riders,
manage internal and external fleets, track jobs
through live route mapping and pay riders,
transparently display pricing for jobs and send
messages to riders. The product also offers
a supplementary fleet of riders to help their
customers meet spikes in demand. Riders
receive better treatment, fairer pay, more
certainty of earnings, and more transparency
of prices per job/shift. The company’s vision
is to enable smaller high street retailers to
compete while increasing the efficiency of
delivery for
the larger e-commerce players.
What does the
company do?
Ryde provides a fully integrated delivery management
platform combining the best of fleet management
software, third
-
party logistics software and a flexible
workforce to e-commerce companies requiring
deliveries, enabling these companies to more effectively
manage demand by supplementing their own fleet with
third party fleets and Ryde’s own fleet of riders.
Problem being solved
Consumers now have high expectations for rapid and
flexible home delivery. These expectations are not
consistently being met because businesses have neither
adequate technology nor adequate fleets to respond to
this consumer demand. What’s more, existing delivery
drivers are often disenfranchised and exploited.
STRATEGIC REPORT
Triple Point VCT 2011 plc | 37
INVESTMENT MANAGER’S REVIEW
Green Highland
Shenval
(Kinlochteacuis)
Green Highland Allt
Choire a Bhalachain
Green Highland Allt Phocachain
Allt Phocachain
Green Highland Allt Phocachain
Allt Larairidh
Green Highland Allt
Luaidhe
Green Highland
Allt Ladaidh
SCOTTISH
HIGHLANDS
The Board, supported by the Investment
Manager, put forward a resolution to
dispose of the A Share Class Assets as
it was considered an opportune time to
optimise value for Shareholders. This
was on the basis of favourable market
conditions, reflecting low discount rates,
scarcity of in demand hydroelectric assets
with inflation-linked Feed-In-Tarriff (“FiT”).
Income and demand for assets with a
long c.15 year remaining FiT period. This
proposal received a significant vote in
favour at the A Share Class Meeting on 29
July 2021.
Following this, and as announced on 29 November
2021, the Hydro Assets in the A Ordinary Share Class,
with the exception of Shenval, were sold for a total
consideration of £4,245,725. This sale followed a
competitive process, whereby bids were received from
all invited bidders which were some of the leading
energy infrastructure investors in the UK and had a
strong understanding of small-scale run of the river
hydroelectric assets. Following an analysis of the bids,
Triple Point Energy Efficiency Infrastructure plc (“TEEC”)
were chosen as the preferred bidder with reference to
key criteria of consideration, conditionality of the bid,
and acceptance of share price agreement terms.
At
the conclusion of the process, TEEC’s final offer was
considered the most attractive for the Company. TEEC is
also managed by TPIM, and therefore additional
measures were implemented at the outset and
carefully monitored to manage any potential
conflict of interest appropriately, including the
Board obtaining a third-party valuation.
We are very pleased with the outcome of
the sale process for A Shareholders, and the
consequential return of the net proceeds of sale
to them. We have now turned our attention to
managing the sale of the remaining A Share Class
interest in Shenval and, at the appropriate time,
a resolution for the wind-down and cancellation
of the A Share Class will be put forward to
Shareholders. Further information can be found in
the Chair’s Statement on page 6 to 15.
Shenval, the remaining minority interest of
the A Share Class, is a hydroelectric scheme
in the Scottish Highlands, which has been
commissioned and is operational. Small-scale
hydro is highly efficient, and it remains one of
the cheapest forms of renewable electricity per
unit. Shenval continues to benefit from UK government
backed FiT payments based on output and from the sale
of the electricity produced to utilities or other power
companies under power purchase agreements (“PPAs”).
Shenval has underperformed during the 12 months to
February 2022 at c.24% below revenue expectation.
The turbine is working well, however, the nine months
to December 2021 were exceptionally dry across the
Scottish Highlands and the site was unable to generate
electricity for six weeks between April and May 2021 due
to Scottish and Southern Electricity grid constraints.
The hydroelectric companies, together with other
industry members and the British Hydropower
Association (“BHA”) have continued to lobby the
Scottish Government over the last year on business
rates in the hydro sector.
However, the assessors have
become entrenched in their position and furthermore
appeals against the 2010 valuations are yet to be
resolved and cases from 2017 are nowhere near
consideration.
It now looks unlikely that the assessors
are going to relent to reduce valuations for the hydro
sector to bring them into line with other renewable
technologies.
The 60% relief introduced by the Scottish
Government in 2018 was extended to 2032 in the 2021
Scottish Budget.
Whilst the relief is welcome and is
sufficient to individual schemes, it does not benefit
multiple schemes grouped within a portfolio due to the
post-Brexit State Aid rules.
It is therefore unlikely that
any progress will be made until the temporary support
has expired.
A Share Class –
Hydroelectric Power Schemes
38 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
INVESTMENT MANAGER’S REVIEW
The Hydro Assets in the B Ordinary Share
Class were also sold as part of the same sale
process as set out above within the A Ordinary
Share Class update, for a total consideration of
£1,102,722, which enabled Broadpoint 3 Ltd to
repay its loan and a portion of the redemption
premium to the Company for £1,096,103.43 in
total. We were pleased with the outcome of this
process for B Shareholders, with the majority of
net proceeds of sale, returned to B Shareholders
on 31 March 2022, in the form of a 10 pence per
share dividend.
The B Share Class remains fully invested with two
Qualifying Investments in companies operating gas fired
energy centres. Both energy centres were commissioned
in May 2018 and consist of containerised gas
combustion engines that generate electricity for onward
sale, especially at times when there is high demand for
power.
In respect of Green Peak, further to the update
provided in the Company’s 2021 Interim Report, the
water ingress issues which previously caused one of the
engines to be offline has now been resolved and all
three engines are fully available. We are also pleased
to report that full insurance coverage, subject to an
excess, has been confirmed by the insurer for both
property damage and business interruption. Whilst
the site has underperformed in respect of energy
generation, the strong electricity market has offset the
underperformance with the company achieving gross
profits for the 12-month period to 31 December 2021.
Distributed Generators has also achieved gross profits
for the 12-month period to 31 December 2021 largely
due to the strong electricity market which has offset the
underperformance of the engines and lower electricity
generation. The company has suffered from some
availability issues, and the site has low redundancy only
having two engines, causing strain on overall availability
when issues arise.
We continue to pursue potential solutions to try to
improve both sites’ operation and increase availability.
As such, from the beginning of May 2022, we have
transitioned to a new Power Optimisation company,
responsible for the trading and dispatch of the sites,
and a new Operations and Maintenance contractor
after continued underperformance. Over the 2021/22
winter period, the significantly rising costs of gas put
pressure on the European electricity market, causing
prices to increase in line. As a result, the spark spread,
that is, the price of electricity less the cost of gas,
remained positive and in some instances even widened.
Throughout this winter period the companies were
able to remain profitable, despite lower availability and
electricity production than forecast. Toward the end
of the period, after the Ukraine-Russia war began, gas
prices remained high. However, high wind output and
warmer temperatures meant that the price of electricity
came off its winter highs. This put pressure on the
spark spread and the number of profitable periods in
which the companies were called to trade accordingly
decreased. The companies do however benefit from a
high-priced Capacity Market contract, won in the 2021
year ahead auctions which helps offset the reduced
trading performance through regular monthly cashflows.
Given the five year holding period has now passed for
the B Share Class under the Company’s Investment
Policy and with renewed transaction activity and
interest against the backdrop of a strong electricity
market, we are considering disposal options for the gas
companies. A sale of the assets will enable a dividend
of the net proceeds to be paid to B Shareholders; at the
appropriate time, a proposal will be put to Shareholders
for the wind-up and cancellation of the B Share Class.
For the following reasons the valuation of Distributed
Generators and Green Peak has been held at the
same carrying value as the 2021 Annual Report. The
carrying values were in line with the independent report
commissioned in early 2021 from an experienced
corporate finance adviser to gauge the market interest
and value attributable to these companies.
The valuation model was first adjusted by actual cash
flows to date and a reduction in the future residual value
of the assets at the end of the life. This was to provide
a conservative view on future decommissioning costs.
A reduction in expected project life to 20 years was
then applied, which the companies’ Corporate Finance
Advisers, after recently marketing the companies as
well as others over the past years, advised is the current
market view on useful operating life of this asset class.
The discount rates used to value the projects were
then adjusted to reflect the reduced long-term risk of
a shorter operating life. Additionally, the companies’
energy market advisers are predicting significant
short term upside on market profitability versus the
market analysis at the time of the independent report
commissioned in early 2021. As well as being future
predictions, these strong market prices have been
realised in the second half of the reporting period and
will continue to be captured in the short-term and so the
discount rate of the cash flows has been reduced. After
applying all these changes to the cashflow forecasts, the
valuations returned were in line with prior year carrying
value, and the independent report commissioned in
early 2021.
Triple Point VCT 2011 plc
B Share Class –
Gas Fired Energy Centres
Triple Point VCT 2011 plc
| 39
STRATEGIC REPORT
INVESTMENT MANAGER’S REVIEW
THE THIRD VENTURE FUND
OFFER FOR SUBSCRIPTION
CLOSED ON 20 AUGUST 2021
HAVING RAISED £10.7 MILLION.
STRATEGIC REPORT
40 | Triple Point VCT 2011 plc
Continued competition for human resources through
2022 is likely to be the main direct inflationary effect on
start-ups. More broadly, economy-wide pressures on the
real incomes, as a result of higher energy costs, cloud
the macro outlook and may lead to corporates as well
as consumers to look to trim budgets – that can present
opportunities for software companies as well as a threat.
There is also the less obvious impact from inflation which
is that it is causing an earlier than expected rise in the cost
of capital as central bankers raise interest rates in order to
restore inflation-fighting credibility in the medium term.
The effect of recent rises in government bond yields has
already been seen in lower revenue valuation multiples in
the listed software sector and in time this may be expected
to impact the valuations at which venture capital is raised
as well, after what has been a benign few years for start-up
valuations. While this may make it somewhat tougher for
existing portfolio companies to raise money at significant
valuation uplifts, it is an environment in which we expect
the Venture Fund to continue to find compelling new and
follow-on opportunities to deploy what will be significant
liquid resources, following the current successful fund raise
and the exit of Credit Kudos.
Despite the uncertainty from the Ukraine-Russia war,
and the inflationary environment, we believe that the
Venture Fund’s portfolio remains well positioned for
future growth and that the recent fund raise stands the
share class in good stead to pursue opportunities as they
develop including a growing number of follow-on funding
opportunities as the portfolio grows and matures.
We are very pleased with the outcome of the sale process
for A Shareholders, and the consequential return of the
net proceeds of sale to them. We have now turned our
attention to managing the sale of the remaining A Share
Class interest in Shenval and, at the appropriate time, a
resolution for the wind-down and cancellation of the A
Share Class will be put forward to Shareholders. Further
information can be found in the Chair’s Statement on
pages 7 to 15.
Given the five year holding period has now passed for
the B Share Class and with renewed transaction activity
and interest against the backdrop of a strong electricity
market, we are considering disposal options for the gas
companies. A sale of the assets will enable a dividend
of the net proceeds to be paid to B Shareholders; at the
appropriate time, a proposal will be put to Shareholders
for the wind-up and cancellation of the B Share Class.
Ian McLennan
Partner
For Triple Point Investment Management LLP
27 May 2022
Offer for subscription
The Venture Fund share class is still a relatively new
member of the VCT sector but has been able to
take advantage of a differentiating Seed-stage B2B
strategy discussed above as well as continued buoyant
conditions for VCT fund raising generally to grow the
size of the new fund raise both in 2021 and 2022.
A third Venture Fund offer for subscription closed on
20 August 2021 having raised £10.70 million and the
fourth offer for subscription opened in September
2021. The Company currently has a Venture Fund
offer for subscription open to new investors. This new
offer had a promising start with 3,357,563 Venture
Shares allotted under the fourth offer for subscription
to December 2021, raising £3.7 million. Following
the February 2022 year end, the Company allotted
an additional 9,973,377 Venture Shares raising £11.2
million, this takes the total number of Venture Shares
in issue to 36,418,808. In light of this the VCT Board
triggered to the over-allotment facility on 15 March
2022 and subsequently on 1 April 2022, raising
the amount that can be raised under the offer for
subscription to £15 million and then £20 million
respectively, allowing the Fund to meet on-going
demand towards the end of the tax year.
This offer has so far to date resulted in funds being
raised in excess of £14.9 million and 13,078,539 new
Shares allotted. For all investments in the 2022/23
tax year, the Offer will remain open until 29 July
2022 unless fully subscribed at an earlier date. The
Board have the discretion to extend the open offer to
14 September 2022 if required.
Outlook
While the outlook for the innovation that the Venture
Fund and its portfolio companies pursue remains
promising, general economic uncertainty has
increased. Just as many societies and economies have
moved beyond intense concerns about Covid-19 they
have encountered an unsettling cocktail of higher
inflation, higher interest rates and the Ukraine-Russia
war.
While the much-discussed spikes in energy and food
inflation are not a significant direct problem for the
sorts of digital businesses that the Venture Fund
backs, we should note that start-ups have already
been grappling for two or three years with the impact
of accelerating skilled wage inflation. Finding and
retaining experienced recruits in areas like digital
marketing and software development has become
more challenging, and the war in Ukraine has added
to some of that because Kyiv, Minsk and even Moscow
had been sources of remote-working developer talent
for some of our portfolio companies. We have been
working with the three portfolio companies with staff in
those locations to see where we can assist.
Triple Point VCT 2011 plc
| 41
STRATEGIC REPORT
INVESTMENT MANAGER’S REVIEW
Investment Manager
Committed to
responsible investments
Triple Point is founded on the principle of people,
purpose and profit. The manager strives to identify and
unlock investment opportunities that have purpose, so
we can help people and planet, while generating profit
for investors.
In line with this business mission and the commitment
to responsible investment, Triple Point has applied to
become a B Corporation (status pending). Certified
B Corporations are businesses that meet the highest
standards of verified social and environmental
performance, public transparency, and legal
accountability to balance profit and purpose.
In 2019, Triple Point became a signatory to the Principles
for Responsible Investing (“PRI”), to demonstrate
best practice in investor Environmental, Social and
Governance (ESG) integration and guide continued
improvement. Triple Point seeks to promote these
principles throughout its business, and they are reflected
in its Sustainable Business Objectives document. These
principles ensure all investment processes have sound
and appropriate integration of ESG practice and are
overseen by the Triple Point Sustainability Group. This
means investment teams are aware of, and can make
informed investments decisions about, key ESG risks and
opportunities.
Triple Point’s overall commitment to sustainable business
and approach to ESG within our investment strategies
is captured in the Sustainable Business Policy, which
is overseen by the Triple Point Sustainability Group.
This Group comprises senior partners and managers
from across Triple Point, who meet monthly. The Group
is chaired by Triple Point’s co-Managing Partner Ben
Beaton. Also reporting to this Group are the Sustainable
Investment Sub-group which comprises senior
investment team members from across Triple Point. The
Group share best practice and learning in sustainability
and ESG integration from across the business acting as
source of sustainability insight, collaboration and review
which stretches across the entire business.
In the view of the Sustainability Group, successful ESG
integration means:
•
named resource at a strategy level to integrate,
monitor and report on ESG issues;
•
integrating ESG considerations throughout
investment processes;
•
ensuring decision-making captures ESG risks and
opportunities, learning from decisions and reporting
to continually enhance ESG integration;
•
pro-actively engaging with investors to understand
their ESG requirements; and
•
challenging systemic issues which slow uptake
of ESG practices by asking questions, offering
alternative solutions, or engaging at a policy level.
ESG Integration Approach for Triple Point VCT
2011 PLC
The assets within the Company are aligned with a range
of international standards and good industry practice,
including the UK Bribery Act, UK Companies Act and the
UK Modern Slavery Act.
The Investment Manager has also implemented ESG
Integration processes specifically associated to the
needs of understanding ESG risk and opportunity for
small, seed companies.
We place proportionate expectations on the Company,
across a range of environmental, social and governance
factors according to the sector, size, stage of growth,
and future growth and development trajectory of the
Company.
It is the Investment Manager’s belief that retrofitting a
sustainable business mindset and model, can be time
consuming and challenging further down the line.
We invest for growth and so we take a considered
judgement that these issues could come to bear during
ownership or at exit, if they are not considered at the
point of investment.
To ensure the effective and consistent application of this
approach, the Investment Manager operates an ESG
Integration Policy which details how ESG considerations
are taken into account throughout the investment
process, from the point of origination to exit.
1.
Management (Culture, Capacity & Governance) – this
refers to the allocation of appropriate resourcing,
training and senior support to ESG integration. It
demonstrates Triple Point’s actions have integrity
aligned with the strategic position of the Company
and oversight from senior management. Examples of
which include:
a.
training across our investment team on ESG;
b.
training of our Investment Committee on ESG;
and
c.
providing greater transparency on our approach
to ESG.
Responsible Investing
42 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
2.
investment (Process & Reporting) – this refers to
action taken in the investment process to assess and
improve ESG factors affecting the target asset, how
these might affect an investment decision and how
we capture decisions and changes to ESG factors
during our asset ownership. Examples of which
include:
a.
formal reviews by the team of ESG trends and
topics at a micro, macro and sector level to feed
into origination process;
b.
ESG due diligence process with results included
at Investment Committee; and
c.
sharing areas of weakness, with constructive
guidance on how to progress so Company
awareness on a range of ESG issues develops
with ownership.
The strategy also explicitly states they will not invest in
adult content, gambling (excluding charitable lotteries
funding good causes or raising funds), animal testing,
arms trade and tobacco.
We are committed to evaluating the success of our
approaches.
Our investment teams report to our Sustainability Group
through an annual review process to ensure adherence
to the process and to share detail on where we believe
we have influenced better or faster progress towards
greater sustainability.
The aim of Triple Point VCT 2011 plc is to invest in
smaller UK businesses to help them grow, with the
primary objective of delivering strong financial returns.
However, the Company and the Investment Manager
are increasingly mindful of the impact, that our activities
and those of the businesses in which we invest have
not just on the environment, but also their employees,
communities, and society at large.
The Company believes that its investment activities
have many positive benefits beyond the returns we
deliver for Shareholders. In the case of the Venture
fund investments, these businesses help create new
employment, develop and implement new technologies
and products, and improve productivity all of which
contribute to the UK economy and have benefit to those
employed in those businesses and their supply chains.
During the year we invested in a number of businesses
with a positive social contribution, including in
healthcare: Quit Genius – an addiction management
platform; Knok Healthcare – a telemedicine video-
conferencing solution that helps reduce hospital waiting
times; and in education: Stepex – a company that
helps people fund further education; and Learnerbly
– a learning and development platform for corporate
employees.
During the Covid-19 pandemic, a number of our
companies provided their services for free, including
Heydoc, who provided free video consultations
and Credit Kudos, who developed a product that
demonstrate to government agencies whether people
qualified for support programmes.
During the Ukraine-Russian war, which began in late
February 2022, Triple Point created a war relief fund
which was offered to all Ukrainian developers in our
portfolio companies in order to contribute to their costs
for transport out of Ukraine, short-term rental payments
and other relevant expenses.
Triple Point VCT 2011 plc
| 43
STRATEGIC REPORT
Investment Portfolio Summary
28 February 2022
28 February 2021
Cost
Valuation
Cost
Valuation
£’000
%
£’000
%
£’000
%
£’000
%
Unquoted qualifying holdings
23,274
75.09
28,169
77.76
17,500
71.64
16,348
70.20
Non-Qualifying holdings
1,476
4.76
1,813
5.00
1,475
6.04
1,488
6.39
Financial assets at fair value through profit
or loss
24,750
79.85
29,982
82.76
18,975
77.68
17,836
76.59
Cash and cash equivalents
6,246
20.15
6,247
17.24
5,451
22.32
5,451
23.41
30,996
100.00
36,229
100.00
24,426
100.00
23,287
100.00
Qualifying Holdings
Venture Investments
QUALIFYING HOLDINGS UNQUOTED
Degreed Inc.
300
0.97
533
1.47
300
1.23
315
1.35
Augnet Ltd
300
0.97
-
-
300
1.23
150
0.64
MWS Technology Ltd
150
0.48
353
0.97
150
0.61
177
0.76
Counting Ltd (t/a Counting Up)
920
2.97
835
2.30
920
3.77
1,044
4.48
Ably Real Time Ltd
1,312
4.23
3,153
8.70
500
2.05
500
2.15
Heydoc Ltd
760
2.45
1,374
3.79
400
1.64
400
1.72
Vyne Technologies Ltd
1,127
3.64
3,725
10.28
560
2.29
894
3.84
Homelyfe Limited (t/a Aventus)
700
2.26
-
-
500
2.05
475
2.04
Digital Therapeutics Inc (t/a Quit Genius)
1,245
4.02
2,755
7.60
698
2.86
614
2.64
Adfenix AB
799
2.58
673
1.86
799
3.27
723
3.10
Credit Kudos
500
1.61
2,518
6.95
500
2.05
500
2.15
Artifical Artists
150
0.48
120
0.33
150
0.61
150
0.64
Veremark
450
1.45
471
1.30
150
0.61
150
0.64
Localz
750
2.42
750
2.07
500
2.05
500
2.15
Sealit
200
0.65
180
0.50
200
0.82
200
0.86
Bkwai
250
0.81
170
0.47
200
0.82
200
0.86
Exate
500
1.61
400
1.10
500
2.05
500
2.15
Expression Insurance
500
1.61
681
1.88
500
2.05
500
2.15
Kamma
500
1.61
250
0.69
500
2.05
500
2.15
Seedata
150
0.48
150
0.41
-
-
-
-
Stepex
499
1.61
499
1.38
-
-
-
-
Anorak
700
2.26
525
1.45
-
-
-
-
Ryde
1,000
3.23
1,000
2.76
-
-
-
-
Nook
250
0.81
250
0.69
-
-
-
-
Tickitto
1,000
3.23
1,000
2.76
-
-
-
-
SonicJobs
450
1.45
450
1.24
-
-
-
-
Superlayer
224
0.72
224
0.62
-
-
-
-
Knok Healthcare
513
1.66
513
1.42
-
-
-
-
Learnebly
200
0.65
200
0.55
-
-
-
-
Pixie
915
2.95
915
2.53
-
-
-
-
Hydroelectric Power
Green Highland Allt Choire A Bhalachain (225) Ltd
-
-
-
-
30
0.12
36
0.15
Green Highland Allt Ladaidh (1148) Ltd
-
-
-
-
1,470
6.02
2,201
9.45
Green Highland Allt Luaidhe (228) Ltd
-
-
-
-
855
3.50
1,037
4.45
Green Highland Allt Phocachain (1015) Ltd
-
-
-
-
858
3.51
1,021
4.38
Green Highland Shenval Ltd
860
2.77
534
1.47
860
3.52
592
2.54
Gas Power
Distributed Generators Ltd
3,200
10.32
1,925
5.31
3,200
13.10
1,925
8.27
Green Peak Generation Ltd
1,900
6.13
1,044
2.88
1,900
7.78
1,044
4.48
23,274
75.09
28,169
77.76
17,500
71.64
16,348
70.20
Qualifying Holdings
44 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
Investment Portfolio Summary
Financial Assets are measured at fair value through profit or loss. The initial best estimate of fair value of these
investments that are either quoted or unquoted on an active market is the transaction price (i.e., cost). The fair value
of these investments is subsequently measured by reference to the enterprise value of the investee company, which is
best deemed to reflect the fair value. Where the Board considers the investee company’s enterprise value to remain
unchanged since acquisition, investments continue to be held at cost less any loan repayments received.
NON-QUALIFYING HOLDINGS
UNQUOTED
28 February 2022
28 February 2021
Cost
Valuation
Cost
Valuation
£’000
%
£’000
%
£’000
%
£’000
%
Non-Qualifying Holdings
Unquoted
SME Funding – Hydroelectric Power
Broadpoint 3 Ltd
1,005
3.24
1,329
3.67
1,005
4.11
1,005
4.32
Other
Modern Power Generation Ltd
471
1.52
484
1.34
470
1.92
483
2.07
1,476
4.76
1,813
5.00
1,475
6.04
1,488
6.39
Triple Point VCT 2011 plc
| 45
STRATEGIC REPORT
Vyne are a payments business that uses
Open Banking application programming
interface (“APIs”) to transfer money directly
from the bank accounts of consumers, to the
bank accounts of the online merchants they
are purchasing items or services from
Ably is the provider of a suite of APIs
to build, extend, and deliver digital
experiences in realtime for more than
250 million devices each month.
Vyne Technologies Limited
Ably Real Time Ltd
Date of first investment
28-Nov-2019
Cost (£)
1,127,185
Valuation (£)
3,725,498
Valuation Method
Last Equity Raise
Income recognised by TP11 for the year (£’000)
-
Equity Held by TP11 (%)
7.95
Equity Held by TPIM managed funds (%)
-
Date of first investment
30-Oct-2019
Cost (£)
1,312,027
Valuation (£)
3,152,986
Valuation Method
Last Equity Raise
Income recognised by TP11 for the year (£’000)
-
Equity Held by TP11 (%)
2.05
Equity Held by TPIM managed funds (%)
-
Summary from Investee Company Financial
Statements (
£’000)
Turnover*
Not disclosed
Earnings before interest, tax,
amortisation and depreciation
(EBITDA)*
Not disclosed
Profit before tax*
Not disclosed
Net assets before VCT loans*
Not disclosed
Net assets*
Not disclosed
Summary from Investee Company Financial
Statements (
£’000)
Turnover*
Not disclosed
Earnings before interest, tax,
amortisation and depreciation
(EBITDA)*
Not disclosed
Profit before tax*
Not disclosed
Net assets before VCT loans*
Not disclosed
Net assets*
Not disclosed
10 LARGEST
INVESTMENTS
*The Investees are exempt from submitting audited financial statements to Companies House hence no financial details have been disclosed.
*The Investees are exempt from submitting audited financial statements to Companies House hence no financial details have been disclosed.
46 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
Quit Genius is the provider of an
online digital therapeutics tool
that helps users quit smoking
and vaping. The app provides
behaviour tracking, tips and
encouragement to users.
Digital Therapeutics Inc
(Quit Genius)
Credit Kudos
Date of first investment
14-Feb-2020
Cost (£)
1,245,285
Valuation (£)
2,754,897
Valuation Method
Last Equity Raise
Income recognised by TP11 for the year (£’000)
-
Equity Held by TP11 (%)
1.67
Equity Held by TPIM managed funds (%)
-
Date of first investment
30-Mar-2020
Cost (£)
500,000
Valuation (£)
2,518,465
Valuation Method
Transaction in
progress
Income recognised by TP11 for the year (£’000)
-
Equity Held by TP11 (%)
2.31
Equity Held by TPIM managed funds (%)
-
Summary from Investee Company Financial
Statements (
£’000)
Turnover*
Not disclosed
Earnings before interest, tax,
amortisation and depreciation
(EBITDA)*
Not disclosed
Profit before tax*
Not disclosed
Net assets before VCT loans*
Not disclosed
Net assets*
Not disclosed
Summary from Investee Company Financial
Statements (
£’000)
Turnover*
Not disclosed
Earnings before interest, tax,
amortisation and depreciation
(EBITDA)*
Not disclosed
Profit before tax*
Not disclosed
Net assets before VCT loans*
Not disclosed
Net assets*
Not disclosed
Credit Kudos is a new wave Credit
Reference Agency that utilises financial
data obtained via Open Banking APIs. This
behavioural data allows consumer lenders to
make better and faster credit decisions.
*The Investees are exempt from submitting audited financial statements to Companies House hence no financial details have been disclosed.
*The Investees are exempt from submitting audited financial statements to Companies House hence no financial details have been disclosed.
Triple Point VCT 2011 plc
| 47
STRATEGIC REPORT
10 LARGEST INVESTMENTS
Heydoc is a clinical system built to enable medical
clinicians and administrative staff to complete their
day-to-day work in one place rather than needing to
use multiple systems. The software covers the entire
patient journey, saving the medical clinicians time.
Distributed Generators Ltd
HeyDoc
Date of first investment
02-Apr-2015
Cost (£)
3,200,000
Valuation (£)
1,925,063
Valuation Method
Discounted Cash
Flow
Income recognised by TP11 for the year (£’000)
-
Equity Held by TP11 (%)
45
Equity Held by TPIM managed funds (%)
45
Date of first investment
20-Nov-2019
Cost (£)
760,016
Valuation (£)
1,374,445
Valuation Method
Last Equity Raise
Income recognised by TP11 for the year (£’000)
-
Equity Held by TP11 (%)
5.98
Equity Held by TPIM managed funds (%)
-
Summary from latest available Investee
Company Financial Statements (
£’000)
Turnover
1,383
Earnings before interest, tax,
amortisation and depreciation
(EBITDA)
270
Profit before tax
78
Net assets before VCT loans
3,088
Net assets
2,129
Summary from Investee Company Financial
Statements (
£’000)
Turnover*
Not disclosed
Earnings before interest, tax,
amortisation and depreciation
(EBITDA)*
Not disclosed
Profit before tax*
Not disclosed
Net assets before VCT loans*
Not disclosed
Net assets*
Not disclosed
Distributed Generators Ltd constructed
a 5 MW gas power plant in Bedford. The
2 x 2.5 MW gas fired MTU Rolls Royce
Engines were installed and construction was
completed in May 2018. The plant generates
revenues through the sale of electricity to
the National Grid, when electricity prices are
at their highest.
*The Investees are exempt from submitting audited financial statements to Companies House hence no financial details have been disclosed.
48 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
10 LARGEST INVESTMENTS
Broadpoint 3 Ltd
owns equity stakes in
hydroelectric power
companies and one digital
deployment company.
Green Peak Generation Ltd
Broadpoint 3 Ltd
Date of first investment
02-Apr-2015
Cost (£)
1,900,000
Valuation (£)
1,043,659
Valuation Method
Discounted Cash
Flow
Income recognised by TP11 for the year (£’000)
-
Equity Held by TP11 (%)
42
Equity Held by TPIM managed funds (%)
90
Date of first investment
08-Jan-2016
Cost (£)
1,005,000
Valuation (£)
1,096,103
Valuation Method
Discounted cash
flow*
Income recognised by TP11 for the year (£’000)
-
Equity Held by TP11 (%)
-
Equity Held by TPIM managed funds (%)
-
Summary from latest available Investee
Company Financial Statements (
£’000)
Turnover
1,884
Earnings before interest,
tax, amortisation and
depreciation (EBITDA)
236
Loss before tax
(16)
Net assets before VCT loans
3,937
Net assets
2,707
Summary from Investee Company Financial
Statements (
£’000)
Turnover**
Not disclosed
Earnings before interest, tax,
amortisation and depreciation
(EBITDA)**
Not disclosed
Profit before tax**
Not disclosed
Net assets before VCT loans**
Not disclosed
Net assets**
Not disclosed
Green Peak Generation Ltd
constructed a 7.5 MW gas power
plant in Bedford. The 3 x 2.5 MW
gas fired MTU Rolls Royce Engines
were installed and construction was
completed in May 2018. The plant will
generate revenues through the sale of
electricity to the National Grid, when
electricity prices are at their highest.
*The Directors consider the fair value to be equivalent to the par value.
**The Investees are exempt from submitting audited financial statements to Companies House hence no financial details have been disclosed.
Triple Point VCT 2011 plc
| 49
STRATEGIC REPORT
10 LARGEST INVESTMENTS
Ryde provides a fully integrated delivery management platform combining the
best of fleet management software, logistics software and a flexible workforce
to e-commerce companies requiring deliveries.
Tickitto
Ryde
Date of first investment
20-Jul-2021
Cost (£)
1,000,003
Valuation (£)
1,000,003
Valuation Method
Last Equity Raise
Income recognised by TP11 for the year (£’000)
-
Equity Held by TP11 (%)
7.87
Equity Held by TPIM managed funds (%)
-
Date of first investment
27-Jul-2021
Cost (£)
1,000,002
Valuation (£)
1,000,002
Valuation Method
Last Equity Raise
Income recognised by TP11 for the year (£’000)
-
Equity Held by TP11 (%)
7.34
Equity Held by TPIM managed funds (%)
-
Summary from Investee Company Financial
Statements (
£’000)
Turnover*
Not disclosed
Earnings before interest, tax,
amortisation and depreciation
(EBITDA)*
Not disclosed
Profit before tax*
Not disclosed
Net assets before VCT loans*
Not disclosed
Net assets*
Not disclosed
Summary from Investee Company Financial
Statements (
£’000)
Turnover*
Not disclosed
Earnings before interest, tax,
amortisation and depreciation
(EBITDA)*
Not disclosed
Profit before tax*
Not disclosed
Net assets before VCT loans*
Not disclosed
Net assets*
Not disclosed
Tickitto provides
an API integration
platform that
connects ticketing
platforms
and travel
distributors.
Approval of the Strategic Report
The Strategic Report has been approved by the Board and signed on their behalf by the Chair.
Jane Owen
Chair
27 May 2022
*The Investees are exempt from submitting audited financial statements to Companies House hence no financial details have been disclosed.
*The Investees are exempt from submitting audited financial statements to Companies House hence no financial details have been disclosed.
50 |
Triple Point VCT 2011 plc
STRATEGIC REPORT
10 LARGEST INVESTMENTS
GOVERNANCE
Board of Directors
GOVERNANCE
52 |
Triple Point VCT 2011 plc
Jane Owen
Jane Owen is the Chair of the Board of the Company. After graduating in law
from Oxford University, Jane was called to the Bar in 1978 and until 1989 was a
practising barrister in the chambers that are now 3 Verulam Buildings.
Subsequently, Jane became UK group legal director at Alexander & Alexander
Services, and was appointed Aon’s General Counsel in the UK in 1997, a position
she held until 2008, where she was also a director of Aon Limited from 2001 to
2008. She was also a Non-Executive Director of TWG Europe Ltd and related
companies and a Governor of James Allen’s Girls’ School.
Chad Murrin
Chad Murrin graduated in law from Cambridge University, and then qualified as a
barrister. He worked for 3i Group plc from 1986-2004, the last five years as 3i’s
Corporate Development Director. In 2004, he set up his own corporate advisory
business, Murrin Associates Limited. He holds the Advanced Diploma in
Corporate Finance from The Corporate Finance Faculty of the ICAEW. He is a
Non-Executive Director of Keytask Management Limited, E.W. Beard (Holdings)
Limited and other companies.
Tim Clarke
Tim Clarke graduated in PPE from Oxford University. He joined Panmure Gordon
& Co as an equities analyst, subsequently becoming a Partner and Head of
Research. He joined Bass PLC in 1990, holding a number of operating roles in the
Hotels, Pub and Restaurant divisions before becoming Chief Executive in 2000.
Following its demerger he was Chief Executive of Mitchells & Butlers PLC until
2009. He was a Non-Executive Director of Associated British Foods PLC from
2004 until 2017. He is currently Chair of Birmingham Airport, Chair of Timothy
Taylor & Co Ltd, and a Non-Executive Director of Hall & Woodhouse Ltd.
Julian Bartlett
Julian Bartlett has significant financial, assurance and advisory experience gained
from over 30 years as a Partner at Grant Thornton UK LLP and formerly at RSM
Robson Rhodes and Deloitte. He has an extensive understanding of listed and
financial services companies including VCTs. He is the Chair of Invesco Fund
Managers Limited, Director and Chair of the Audit and Risk Committee of Invesco
Pensions Limited and Director of Lindsell Train Limited. He was formerly a Non-
Executive Director of FFI Holdings plc from August 2017 until it ceased trading
on AIM in August 2019. Julian is a Fellow of the Institute of Chartered
Accountants in England and Wales.
Corporate Governance Report
GOVERNANCE
Triple Point VCT 2011 plc
| 53
Compliance Statement
The Board of Triple Point VCT 2011 plc has considered the principles and provisions of the Association of Investment Companies Code of Corporate
Governance 2019 (AIC Code). The AIC Code addresses the principles and provisions set out in the UK Corporate Governance Code (the “UK
Code”), as well as setting out additional provisions on issues that are of specific relevance to Triple Point VCT 2011 plc.
The Board considers that reporting against the principles and provisions of the AIC Code, which has been endorsed by the Financial Reporting
Council, will provide improved reporting to Shareholders.
The Company has complied with the principles and provisions of the AIC Code except as set out below:
AIC Code of Corporate Governance
Explanation
The appointment of a Senior Independent Director (Provision 14)
As there are only three independent Non-Executive Directors, excluding the Chair,
with one Non-Executive Director intending to step down immediately following
the 2022 AGM, it is not considered appropriate to identify a member of the Board
as senior independent Director. The independent Non-Executive Directors, as
appropriate, will act as a sounding board for the Chair, serve as intermediaries
between Directors and Shareholders, and evaluate the Chair’s performance as part
of the Board’s annual evaluation.
An external search consultancy should generally be used for the appointment of
non-executive directors (Provision 25)
The Board considered the use of an external search consultancy when looking
to appoint a new non-executive Director to the Board. However, it was decided
that suitable candidates for the role could be sourced without the use of a search
consultancy, and the significant cost of using a search consultancy was not deemed
appropriate for the Company at this time. The Board will consider the use of an
external search consultancy for future Board appointments.
If the Chair of the Board is a member of the Audit Committee, the Board should
explain in the annual report why it believes this is appropriate (Provision 29)
Jane Owen is a member of the Audit Committee and Chair of the Board. Given the
size and structure of the Board it was deemed in best interest of Shareholders to
have the breadth of experience of all Directors throughout the audit process.
Chair of the Audit Committee (Provision 29)
Jane Owen, the Chair of the Board, was the Chair of the Audit Committee. The
Board considered this appointment appropriate given the size and complexity of
the Company. However, this was rectified during the year following Julian Bartlett’s
appointment as Chair of the Audit Committee on 8 February 2022.
The AIC Code is available on the AIC website (www.theaic.co.uk). It includes an explanation of how the AIC Code adapts the principles and
provisions set out in the UK Code to make them relevant for investment companies.
Corporate Governance Report
GOVERNANCE
54 |
Triple Point VCT 2011 plc
Board of Directors
The Board are pleased to have appointed Julian Bartlett as an
Independent Non-Executive Director and Chair of the Audit
Committee effective 8 February 2022. The Board considered the use
of an external search consultancy (provision 25 of the AIC Code) when
looking to appoint a new non-executive Director to the Board.
However, it was decided that a suitable candidate for the role could
be sourced without the use of a search consultancy, and the
significant cost of using a search consultancy was not deemed
appropriate for the Company at this time. The Board will consider the
use of an external search consultancy for future Board appointments.
Following Julian’s appointment, the Board comprises four Non-
Executive Directors.
Following an orderly succession period, Tim Clarke, Non-Executive
Director of the Company, will not stand for re-election at the
Company’s AGM expected to be held in July 2022 and will step down
immediately following the conclusion of the AGM.
All Directors are considered independent and day-to-day
management responsibilities are delegated to the Investment
Manager. The Directors have a combination of skills, experience and
knowledge which are relevant to the Company. Biographies of each
director are presented on page 52 of this report.
The Directors are provided with key information on the Company’s
activities, including regulatory and statutory requirements, by the
Investment Manager and Company Secretary, Hanway Advisory
Limited.
The Board has direct access to the Company Secretary and may also
take independent professional advice at the Company’s expense
where necessary in the performance of their duties. During the year,
the Board was satisfied that all Directors were able to commit
sufficient time to discharge their responsibilities effectively having
given due consideration to their other significant commitments. The
Directors were advised on appointment of the expected time required
to fulfil their roles and have confirmed that they remain able to make
that commitment. No external appointments accepted during the
year were considered to be significant for the relevant Directors,
taking into account the expected time commitment and nature of
these roles.
The Directors’ other principal commitments are listed on pages 52.
The Chair, Jane Owen, leads the Board and is responsible for its
overall effectiveness in directing the Company. The Chair leads the
process in determining its strategy and the achievement of its
objectives. The Chair is responsible for setting the Board agenda
focusing on strategy, performance, value creation, culture,
stakeholders and ensuring that issues relevant to these areas are
reserved for Board decision.
The Chair facilitates constructive Board
relations and the effective contribution of all the Directors,
encouraging a culture of openness and debate and ensures the
Directors receive accurate, timely and clear information. The Chair
does not have significant commitments which conflict with her Board
responsibilities.
Appointment of New Directors
Any appointment to the Board is subject to a formal, rigorous and
transparent procedure and is based on merit and objective criteria
which promotes diversity of gender, social and ethnic backgrounds,
cognitive and personal strengths.
Company’s Operations
The Investment Manager has authority over the management of the
investment portfolio, the organisation of custodial services,
accounting and administrative services. The Investment Manager
makes investment recommendations for the Board’s approval.
The Board meets regularly in person or via video conference call at
least four times a year, and on other occasions as required, to discuss
and approve new or follow-on investments, and review the investment
performance and monitor compliance with the investment policy laid
down by the Board.
The Board’s main focus is to promote the long-term sustainable
success of the Company, to deliver value for Shareholders and
contribute to wider society. The Board does not routinely involve itself
in day-to-day business decisions but there is a formal schedule of
matters that requires the Board’s specific approval, as well as
decisions that can be delegated to the Board Committees.
The key matters reserved to the Board, include but are not limited to:
•
review investment performance and monitor compliance with
the investment policy;
•
the consideration and approval of future developments or
changes to the investment policy, including risk and asset
allocation;
•
overall leadership of the Company and setting of its purpose,
culture, values and standards;
•
approval of any dividend or return of capital to be paid to the
Shareholders;
•
the appointment, evaluation, removal and remuneration of the
Investment Manager and the Company Secretary;
•
board membership and powers including the appointment
and removal of Board members;
•
ensuring an adequate Board succession planning;
•
ensuring the maintenance of a system of internal controls and
risk management;
•
approval and issue of the annual and half yearly results;
•
review of the Company’s corporate governance arrangements
and annual review of continuing compliance with the AIC
Code of Corporate Governance published by the AIC from
time to time;
•
the performance of the Company, including monitoring the
net asset value per share;
Corporate Governance Report
GOVERNANCE
Triple Point VCT 2011 plc
| 55
•
monitoring S
hareholder profiles and considering
Shareholder
communications; and
•
approving investments.
The Company Secretary is responsible for ensuring that Board
procedures are complied with, advising the Board on all governance
matters, supporting the Chair and helping the Board and its
committees to function effectively. The Company Secretary will also
provide the Board with support in ensuring that it has the policies,
processes, information, time and resources it needs in order to
function effectively.
The Company’s articles of association and the schedule of matters
reserved to the Board for decision provide that the appointment and
removal of the Company Secretary is a matter for the full Board.
The Board reviews the performance of the Investment Manager
annually taking into consideration the contractual arrangements and
scrutinises performance. The Board as a whole carries out this review
and due to the size of the Board, does not consider it appropriate to
establish a separate management engagement committee.
Discussions of the Board
During the period, the following were the key matters considered by
the Board:
•
approval of Company policies;
•
succession Planning and appointment of Julian Bartlett as a
Non-Executive Director;
•
approval of the disposal of Hydro Assets;
•
approval of Venture Share Class investments;
•
annual and half year reports to Shareholder’s;
•
quarterly and, where applicable, ad hoc approval of NAVs; and
•
declaration of the interim dividends.
Re-election of Directors
Directors’ retirement and re-election is subject to the Company’s
articles of association and the AIC Code. The AIC Code requires that
all Directors should be subject to an annual re-election. All Directors,
except for Tim Clarke, have agreed to submit themselves for annual
re-election at the next Annual General Meeting. In line with the
Company’s Succession Plan, Tim Clarke will not stand for re-election
at the Company’s AGM expected to be held in July 2022 and will step
down immediately following the conclusion of the AGM.
Independence of Directors
The Board has a non-executive Chair and three other non-executive
Directors, all of whom were considered independent on and since
their appointment. All of the Directors are independent of the
Investment Manager.
The AIC Code outlines circumstances that are likely to impair a
director’s independence including whether a director has served on
the B
oard for more than nine years from the date of their first
appointment. All Directors, except newly appointed Julian Bartlett,
have served on the Board for nine years or more. Length of service is
currently one of several indicators the Board consider when assessing
independence. The Board is of the view that a term of service in
excess of nine years does not in itself compromise independence and
notes the positive contribution that their long-service offers. The
longer serving directors bring knowledge and experience of the
Company’s history which is particularly important in relation to the A
and B Shares and so contributes to the long-term sustainable success
of the Company. The Board regularly reviews the independence of its
Directors and are satisfied that all Directors remain independent,
including in character and judgement.
Policy on Tenure of the Chair
The Board considers that the length of time each Director, including
the Chair, serves on the Board should not be limited and has not set a
finite tenure policy. Continuity, self-examination and ability to do the
job are the relevant criteria on which the Board assesses a Director’s
independence. Length of service of current Directors and future
succession planning will be reviewed each year as part of the Board
evaluation process.
Succession Plan
The Board continues to seek to achieve a progressive refreshing of
the Board, taking into account the challenges and opportunities
facing the Company, the balance of skills and expertise, and the need
for a diverse pipeline for succession balanced against the benefit of
historical knowledge. The Board is pleased to have made positive
progress on the gradual refreshing of the Board this year through the
appointment of Julian Bartlett, in line with its Succession Plan.
Board Committees
The Board only has one committee which is the Audit Committee.
The Directors consider that due to the size of the Board, there being
no employees or executive directors, it is not necessary to appoint a
separate remuneration committee. The remuneration report is
detailed on pages 62 to 67.
Corporate Governance Report
GOVERNANCE
56 |
Triple Point VCT 2011 plc
Board Meeting Attendance
The Board meets formally on, at least, a quarterly basis with
additional meetings required from time to time.
During the period the following Board meetings were held and the
number attended by each Director compared with the maximum
possible attendance:
Directors
Board Meetings
Audit Committee
Jane Owen, Chair
15/15
2/2
Chad Murrin
15/15
2/2
Tim Clarke
15/15
2/2
Julian Bartlett
1/1*
–
* appointed on 8 February 2022
Performance Evaluation
The Board, led by the Chair, established a formal process for a formal
and rigorous annual evaluation of the performance of the Board,
individual Directors and the Audit Committee. The evaluation
considered the composition, diversity, investment matters,
development and how effectively each member works together to
achieve its objectives.
During the period, the Board conducted a performance evaluation by
completing a written questionnaire to appraise and gather useful
learnings on the functioning of the Board, the Audit Committee and
individual Directors, and the Chair.
The Chair, supported by the Company Secretary, acted on the results
of the evaluation.
Having conducted its performance evaluation, the
Board believes that it has been effective in carrying out its objectives
and that each individual Director has been effective and
demonstrated commitment to the role.
The Board discussed the key challenges and opportunities that were
identified through the performance evaluation and agreed
appropriate development points on which progress will be assessed
in the next financial period.
Challenges
2022 Development Points
The Company’s KPIs are not
reflective of the metrics driving
future performance.
Regularly review whether the
KPIs the Company report against
continue to be appropriate. TPIM
to report to the Board against
these KPIs on a quarterly basis.
The fees of the officers of the
Company should be reviewed
to reflect the time commitment,
responsibilities of the role and to
ensure market competitiveness.
Undertake a formal benchmarking
exercise to determine if the level
of fees should be changed to
reflect the time commitment and
responsibilities of the role taking
into account the size and structure
of the Company.
The Company’s succession plan
requires further development to
safeguard long term stability of the
Board.
Develop a formal written
succession plan, alongside an
emergency contingency plan.
Three areas of improvement were identified in the previous year’s
annual report. The first was that there should be enhanced
information flows outside of Board Meetings. Throughout the year
there were improved information flow
s, in particular due to the sale of
the hydroelectric assets, increases in NAVs and consideration of
Venture portfolio performance, and an update was provided where ad
hoc information was not covered elsewhere. The second was to
dedicate more time to considering the overall strategy of the
Company, and the Board had extensive discussions during the year in
particular as it presented a resolution (which was subsequently
approved) to Shareholders to sell the remaining assets in the A Share
C
lass having identified that this was an opportune time for a sale, and
B Share Class as it had surpassed its five
-year holding period, taking
into account asset management issues which could impact a sale. The
Board were similarly provided with updates on the Venture portfolio,
and at the same time considered the direction of the portfolio as a
whole. The third element was a more in-depth review of the level of
remuneration of Directors which was undertaken as part of the
performance evaluation.
Corporate Social Responsibility
The Board is committed to integrating social, environmental and
governance matters in the Company’s business operations, including
the Company itself and the companies it invests in. The Board is
actively seeking ways to interact with their stakeholders. The Board
seeks to avoid investing in companies which do not operate within
ethical, environmental and social legislation. Details on the Company’s
responsible investing can be found on pages 42 to 43.
Internal Control and Risk Management
The Board has overall responsibility for establishing procedures to
manage risk, overseeing the internal control framework, determining
the nature and extent of the principal risks the Company is willing to
take in order to achieve its long-term strategic objectives, and
identifying emerging risks. The purpose of an internal control
framework is to ensure that proper accounting records are maintained,
the Company’s assets are safeguarded, and the financial information
used within the business and for publication is accurate and reliable;
such a system can only provide reasonable and not absolute assurance
against material misstatement or loss. Emerging risks are regularly
monitored, and to the extent possible or practicable, mitigating
actions are implemented.
The system of risk management and internal control is designed to
manage rather than eliminate the risk of failure to achieve business
objectives. As part of this process an annual review of the risk
management and internal control systems is carried out. The review
covers all material controls including financial, operational and
compliance controls.
The Directors regularly review financial results and investment
performance with the Investment Manager.
Corporate Governance Report
GOVERNANCE
Triple Point VCT 2011 plc
| 57
The Directors have established an ongoing process designed to meet
the particular needs of the Company in identifying, evaluating and
managing the significant and emerging risks to which it is exposed
including, among others, market risk, VCT qualifying investment risk
and operational risks which are recorded on a risk register. The
controls employed to mitigate these risks are identified and the
residual risks are rated taking into account the impact of the mitigating
factors. The risk register is reviewed bi-annually. The principal risks and
uncertainties including emerging risks identified from the risk register
and a description of the Company’s risk management procedures can
be found on pages 24 to 25.
The Directors regularly review the system of internal controls, both
financial and non-financial, operated by the Company and the
Investment Manager. These include controls designed to ensure that
the Company’s assets are safeguarded and that proper accounting
records are maintained. Internal control systems include the
production and review of quarterly bank reconciliations and
management accounts. The Investment Manager is engaged to
provide accounting services and the Company Secretary provides
secretarial services and retains physical custody of the documents of
title relating to investments.
Capital management is monitored and controlled by the Investment
Manager. The capital being managed includes equity and fixed
interest VCT qualifying investments, cash balances and liquid
resources including debtors and creditors. The Investment Manager’s
procedures are subject to internal compliance checks.
The Company’s objectives when managing capital are:
•
to safeguard its ability to continue as a going concern, so that
it can continue to provide returns to Shareholders and benefits
for other stakeholders;
•
to ensure sufficient liquid resources are available to meet the
funding requirements of its investments and to fund new
investments where identified.
Stakeholder Engagement
The Company continuously interacts with a variety of stakeholders
important to its success. This includes regular engagement with the
Company’s Shareholders and other stakeholders by the Board and the
Investment Manager. The Directors are responsible for acting in a way
that they consider, in good faith, is the most likely to promote the
success of the Company for the benefit of its members. In doing so,
they have regard for the needs of stakeholders and the wider society
along with the matters set out in the Section 172(1) statement on
pages 27 to 29.
The Company is committed to understanding the views of its
stakeholders and maintaining effective dialogue with its key
stakeholders of which include: Shareholders, investee companies; the
Investment Manager; lenders; and the wider communities in which the
Company and its investee companies operate.
Shareholders are encouraged to attend and vote at the Company’s
Annual General Meeting, along with the Company’s other Shareholder
meetings, so they can discuss governance and strategy and the Board
can enhance its understanding of Shareholder views. The Board will
attend the Company’s Shareholder meetings to answer any
Sshareholder questions and the Chair will make herself available, as
necessary, outside of these meetings to speak to Shareholders.
The Board is committed to providing investors with regular
announcements of significant events affecting the Company and its
investee companies.
All investor documentation is available to download from the
Company’s website: https://www.triplepoint.co.uk/current-vcts/triple-
point-vct-2011-plc/s2539/
Stakeholder engagement is set out in the Section 172(1) statement on
pages 27 to 29.
The Board has considered the AIC Code recommendations in respect
of arrangements by which staff of the Investment Manager and
Administrator may, in confidence, raise concerns within their
organisations about possible improprieties in matters of financial
reporting or other matters. It has concluded that adequate
arrangements are in place for the proportionate and independent
investigation of such matters and, where necessary, for appropriate
follow-up action to be taken within their organisations.
Directors’ Share Interests
All of the Directors’ S
hare interests were held beneficially and they are
actively encouraged to own Shares. Details of the Directors’ share
interests can be found in the remuneration report on page 65. The
Company has not set out any formal requirements or guidelines to
Directors concerning their ownership of Shares in the Company.
On behalf of the Board.
JANE OWEN
Chair
27 May 2022
AUDIT
COMMITTEE
REPORT
Audit Committee Report
GOVERNANCE
Triple Point VCT 2011 plc
| 59
The following pages set out the Audit Committee’s report on how it
has discharged its duties in accordance with the AIC Code and its
activities in respect of the period ended 28 February 2022.
On 8 February 2022, Jane Owen stepped down as Chair of the Audit
Committee, and Julian Bartlett, who was independent on
appointment, was appointed as Chair. Jane, who was independent on
appointment, and due to the size and structure of the Board has
remained a member of the Audit Committee, along with the Non-
Executive Directors, Tim Clarke, and Chad Murrin. Following an
orderly succession period, Tim Clarke will not stand for re-election at
the Company’s AGM expected to be held in July 2022 and will step
down from the Board and Audit Committee following the conclusion
of the AGM.
The Audit Committee deals with matters relating to audit, financial
reporting and internal control systems. The Audit Committee meets at
least twice a year and as required. The Audit Committee also has
direct access to BDO LLP, the Company’s external auditor.
The Audit Committee has been in operation throughout the period
and operates within clearly defined terms of reference.
Audit Committee Role and Responsibilities
The Audit Committee has the primary responsibility for reviewing the
financial statements and the accounting principles and practices
underlying them, liaising with the external auditors and reviewing the
effectiveness of internal controls.
The Audit Committee’s terms of reference include the following roles
and responsibilities:
•
periodically considering the need for an internal audit function;
•
monitor the integrity of the financial statements of the
Company and any formal announcements relating to the
financial performance and reviewing significant financial
reporting judgements contained in them;
•
oversee the relationship with the external auditor including,
but not limited to, assessing annually their independence and
objectivity taking into account relevant professional and
regulatory requirements and the overall relationship with the
auditor, including the provision of any non-audit services;
•
monitoring the extent to which the external auditor is engaged
to supply non-audit services;
•
ensuring that the Investment Manager has arrangements in
place for the investigation and follow-up of any concerns
raised confidentially by staff in relation to propriety of financial
reporting or other matters;
•
keep under review the Company’s internal financial controls
and review the adequacy and effectiveness of the Company’s
internal control and risk management systems and monitor the
proposed implementation of such controls;
•
report to the Board on significant issues relating to the financial
statements and how they were addressed; its assessment of the
effectiveness of the audit process; any key matters raised by
the external auditor and any other issues on which the Board
has requested the Audit Committee’s opinion; and
•
report to the Board on how it has discharged its
responsibilities.
The Audit Committee reviews its terms of reference and effectiveness
annually and recommends to the Board any changes required as a
result of the review.
The terms of reference are available on request
from the Company Secretary.
In respect of the year ended 28 February 2022, the Audit Committee
discharged its responsibilities by:
•
reviewing the external auditor’s plan for the audit of the
financial statements, including identification of key risks and
confirmation of auditor independence;
•
monitoring the integrity of the financial statements of the
Company and any formal announcements relating to the
Company’s financial performance, and reviewing significant
financial reporting judgements contained in them;
•
reviewing the Company’s internal financial controls and
internal control and risk management systems operated in
relation to the Company’s business and assessing those
controls in minimising the impact of key risks;
•
reviewing periodic reports on the effectiveness of TPIM’s
internal control and risk management procedures ;
•
reviewing the appropriateness of the Company’s accounting
policies;
•
poviding advice on whether the annual report and accounts,
taken as a whole, is fair, balanced and understandable, and
provides the information necessary for Shareholders to assess
the Company’s position and performance, business model and
strategy;
•
reviewing the Company’s annual and half-yearly results prior to
Board approval;
•
making recommendations to the Board regarding the
reappointment of the external auditor and approving their
remuneration;
•
reviewing and monitoring the external auditor’s independence
and objectivity;
•
reviewing the effectiveness of the external audit process,
taking into consideration relevant UK professional and
regulatory requirements;
•
reviewing the Company’s going concern and viability status;
and
•
reviewing and discussing the external auditor’s findings.
The Board considers that the members of the Audit Committee
collectively have the skills and experience required to discharge their
duties effectively and the Audit Committee as a whole has
competence relevant to the sector in which it operates.
The Company does not have an independent internal audit function
as it is not deemed appropriate given the size of the Company and
the nature of the Company’s business.
However, the Audit
Committee considers annually whether there is a need for such a
function and, if there were, would recommend it be established.
Audit Committee Report
GOVERNANCE
60 |
Triple Point VCT 2011 plc
Financial Reporting
The primary role of the Audit Committee in relation to financial
reporting is to review with the Investment Manager and the
Administrator and the Auditor the appropriateness of the half year
report and Annual Report and financial statements, concentrating on,
amongst other matters:
•
compliance with financial reporting standards and relevant
financial and governance reporting requirements;
•
amendments to legislation and corporate governance
reporting requirements;
•
the impact of any new and proposed amendments to
accounting standards which affect the Company;
•
material areas in which significant judgements have been
applied;
•
whether the Audit Committee believes that proper and
appropriate processes and procedures have been followed in
the preparation of the annual report; and
•
considering and recommending the contents of the annual
report and financial statements for approval.
Significant Issues Raised by the
Audit Committee
The Audit Committee is responsible for considering and reporting on
any significant issues that arise in relation to the Financial Statements
and how they have been addressed.
The following key issues were discussed:
•
compliance with HM Revenue & Customs conditions for
maintenance of approved Venture Capital Trust status;
•
valuation and existence of unquoted investments; and
•
future cash flow projections for the A and B
Share Class
investments.
Compliance with HMRC Conditions
The Investment Manager provides the Board with regular qualifying
investment updates. This report, shows the current qualifying
percentage position of the Company and highlights and actions which
may be required to maintain this position in the future. The Board also
assesses the future qualifying position of the Company with
assumptions on divestment of assets. The qualifying position of the
Company is a recurring agenda item at Board meetings.
The Company also has in place an engagement with Philip Hare and
Associates LLP. The Board seeks their opinion before undertaking any
material transaction which may affect the qualifying status of the
Company. The Company also seeks the opinion of Shoosmiths LLP
when making any new Venture Fund Investments.
Valuation & Future Cash Flow Projections
The Company’s unquoted Investment portfolio is valued in line with
the International Private Equity Valuation guidelines. The Company’s
accounting policy is to designate investments at fair value through
profit or loss. Therefore, the most significant risk in the financial
statements is whether its investments are fairly valued. Being
unquoted there is uncertainty and estimation involved in determining
the investment valuations.
There is also an inherent risk of management override as the
Investment Manager’s fee is calculated based on NAV as disclosed in
note 5 to the financial statements. The Investment Manager is
responsible for calculating the NAV, prior to approval by the Board.
On a quarterly basis, the Investment Manager provides a detailed
analysis of the NAV highlighting any movements and assumption
changes from the previous quarter’s NAV, including assessing any
impact of macroeconomic developments. This analysis and the
rationale for any changes made is considered and challenged and
ultimately approved by the Board.
Going concern and viability statement
The Board is required to consider and report on the longer-term
viability of the business as well as assess the appropriateness of
applying the going concern assumption.
The Audit Committee has taken account of the solvency and liquidity
position of the Company shown in the financial statements and the
information provided by the Investment Manager on the forecasted
cashflow for the Company and expected pipeline.
As a result, the
Audit Committee consider that it is appropriate to adopt the going
concern basis of preparation of the financial statements.
External Audit
It is the Audit Committee’s responsibility to monitor the performance,
objectivity and independence of the external auditors and this is
assessed by the Audit Committee each year. In evaluating BDO LLP’s
performance, the Audit Committee examine effectiveness of the audit
process, independence and objectivity of the auditor, taking into
consideration the length of tenure of the external auditors, the non-
audit services undertaken during the year and relevant UK
professional and regulatory requirements, and the quality of delivery
of its services.
BDO LLP attended one of the two formal Audit Committee meetings
held during the year. Matters typically discussed include the Auditor’s
assessment of the transparency and openness of the Investment
Manager, confirmation that there has been no restriction in scope
placed on them, the independence of their audit and how they have
exercised professional scepticism.
When considering whether to recommend the reappointment of the
external auditor, the Audit Committee takes into account their current
fee compared to the external audit fees paid by other similar
companies. The quality and competence of the external auditor is
also taken into consideration. The Audit Committee will then
Audit Committee Report
GOVERNANCE
Triple Point VCT 2011 plc
| 61
recommend to the Board the appointment of an external auditor
which is approved by Shareholders at the Annual General Meeting.
The FRC’s Ethical Standard requires the audit partner to rotate every
five years. The first audit engagement for BDO LLP was for the year
ended 28 February 2018 and this is the audit partners 5th, and
therefore, final year.
The Audit Committee will
discuss and agree the
appointment of a new audit partner with
BDO LLP in advance of the
next audit.
The independence and effectiveness of the external audit process is
assessed as part of the Board evaluation conducted annually and by
the quality and content of the audit
scoping and findings report
provided to the Audit Committee by the external auditor and the
discussions then held on topics raised. The Audit Committee will
challenge the external auditor at the Audit Committee meeting if
appropriate.
Non-Audit Services
The Audit Committee safeguards the objectivity and independence of
the auditor by reviewing the nature and extent of non-audit services
supplied by the external auditor to the Company. Details of fees paid
to BDO LLP during the year are disclosed in note 7 to the financial
statements. During the year, BDO LLP were appointed to perform
certain agreed-upon procedures with regards to the net asset value of
the Venture fund as at 31 January 2022, as part of the Board’s
consideration of the appropriateness of the issue price for the most
recent Venture Fund allotment. The Audit Committee approved these
fees after a review of the level and nature of work to be performed
and were satisfied that they are appropriate for the scope of the work
required.
The Audit Committee was satisfied that BDO LLP had adequate
safeguards in place and that provision of these non-audit services did
not affect the objectivity or independence of the external auditor.
Independence
The Audit Committee is required to consider the independence of the
external auditor. In fulfilling this requirement, the Audit Committee
has considered the Audit Plan from BDO LLP which describes their
arrangements to identify, report and manage their independence.
Audit Committee Meeting Attendance
During the period, the following Audit Committee meetings were
held, and the number attended by each director compared with the
maximum possible attendance:
Directors
Audit Committee Meetings
Jane Owen, Chair
2/2
Chad Murrin
2/2
Tim Clarke
2/2
Julian Bartlett
0/0*
*Julian Bartlett was appointed to the Board on 8 February 2022
The Audit Committee relies on the Investment Manager to assess the
valuation of unquoted investments and the existence of those
investments, however the Audit Committee considers, and challenges
information provided by the Investment Manager and ultimate
approval for decisions is given by the Board. The Investment Manager
has a director on the board of all the investee companies and meets
regularly with the other directors and hence has an oversight of all the
investments made. The Audit Committee have reviewed the
valuations and discussed them with both the Investment Manager and
the external auditor to confirm their assessment of the valuation of
the unquoted investments and the existence of those investments.
The Investment Manager has confirmed to the Audit Committee that
the conditions for maintaining the Company’s status as an approved
Venture Capital Trust had been complied with throughout the year.
The position has been reviewed by Philip Hare & Associates LLP in its
capacity as adviser to the Company on taxation matters.
The Audit Committee has considered the whole Report and Accounts
for the year ended 28 February 2022 and has reported to the Board
that it considers them to be fair, balanced and understandable
providing the information necessary for Shareholders to assess the
Company’s position, performance, business model and strategy.
On behalf of the Board.
JULIAN BARTLETT
Audit Committee Chair
27 May 2022
DIRECTORS’
REMUNERATION
REPORT
Directors’ Remuneration Report
GOVERNANCE
Triple Point VCT 2011 plc
| 63
Statement of the Chair
I am pleased to present the Remuneration Report on behalf of the
Board for the year ended 28 February 2022.
This report is submitted in accordance with schedule 8 of the Large
and Medium Sized Companies and Groups (Accounts and Reports)
(amendment) Regulations 2013 and The Companies (Miscellaneous
Reporting) Regulations 2018, in respect of the year ended
28 February 2022.
This report also meets the Financial Conduct
Authority’s Listing Rules and describes how the Board has applied the
principles and provisions relating to Directors’ remuneration set out in
the AIC Code. The reporting requirements require two sections to be
included:
•
directors’ Remuneration Policy – This sets out our
Remuneration Policy for Directors of the Company that has
been in place since 9 July 2020 following approval by
Shareholders.
•
annual Remuneration Report – This sets out how our Directors
were paid for the period ended 28 February 2022. There will
be an advisory Shareholder vote on this section of the report
at our 2022 AGM.
We value engagement with our Shareholders and for the constructive
feedback we receive and look forward to your support at the
forthcoming AGM.
JANE OWEN
Chair
Directors’ Remuneration Report
GOVERNANCE
64 |
Triple Point VCT 2011 plc
Directors’ Remuneration Policy
Remuneration Policy Overview
The Board currently comprises four Directors, all of whom are Non-
Executive. The Board’s policy is that the remuneration of Non-
Executive Directors should reflect the experience of the Board as a
whole, be fair and be comparable with that of other relevant Venture
Capital Trusts that are similar in size and have similar investment
objectives and structures. Furthermore, the level of remuneration
should be sufficient to attract and retain the Directors needed to
oversee the Company properly and to reflect the specific
circumstances of the Company, the duties and responsibilities of the
Directors and the value and amount of time committed to the
Company’s affairs. The articles of association provide that the
Directors shall be paid in aggregate a sum not exceeding £100,000
per annum. None of the Directors are eligible for bonuses, pension
benefits, share options, long-term incentive schemes or other benefits
in respect of their services as Non-Executive Directors of the
Company. There are no planned changes to the Remuneration Policy
last approved by Shareholders at the 2020 AGM.
Consideration of Remuneration
The Board does not have a separate Remuneration Committee, as the
Company has no employees or executive directors. The Board has
not retained external advisers in relation to remuneration matters but
has access to information about Directors’ fees paid by other
companies of a similar size and type. As such, the Board as a whole
will consider the remuneration of the Directors, however no director is
involved in determining their own remuneration.
The Board will
review the remuneration of the Directors in line with the VCT industry
on an annual basis, if thought appropriate.
Otherwise, only a change
in responsibilities is likely to incur a change in remuneration of any
one Director or the remuneration policy itself.
Directors’ Service Contracts
The Directors are engaged under letters of appointment and do not
have service contracts with the Company.
Directors’ Term of Office
The Directors’ letters of appointment provide for three months written
notice to be given by either party. Each Director will be subject to
annual re-election by Shareholders at the Company’s Annual General
Meeting in each financial year.
Policy on Payment for Loss of Office
A Director who ceases to hold office is not entitled to receive any
payment other than accrued fees (if any) for past services.
Consideration of Shareholder Views
The Company is committed to ongoing Shareholder dialogue and
takes an active interest in voting outcomes. Where there are
substantial votes against resolutions in relation to directors’
remuneration, the Company will seek the reasons for any such vote
and will detail any resulting actions in the Directors’ Remuneration
Report. No views which are relevant to the formulation of the
Directors’ remuneration policy have been expressed to the Company
by Shareholders, whether at a general meeting or otherwise.
Future Policy Table
The Directors are entitled only to the fees as set out in the table below. No element of Directors’ remuneration is subject to performance factors.
There are no other fees payable to the Directors for additional services outside of their contracts.
Component
How it Operates
Maximum Fee
Link to Strategy
Provisions to
Recover or
Withhold Sums
Annual Fee
Each Director receives
a basic fee which is
paid on a quarterly
basis.
The total aggregate fees that can be
paid to the Directors is calculated in
accordance with the articles of
association.
The level of the annual fee has been
set to attract and retain high calibre
Directors with the skills and
experience necessary for the role.
The fee has been benchmarked
against companies of a similar size.
There are no
provisions to
recover or
withhold sums.
Other benefits
The Directors shall be
entitled to be repaid
expenses.
Article 89 of the Company’s Articles of
Association permits for any director to
be repaid reasonable
expenses incurred
in attending or returning from meetings
of the Board, committees of the Board
or Shareholder meetings or otherwise in
connection with the performance of their
duties as Directors of the Company.
In line with market practice, the
Company will reimburse the
Directors for expenses to ensure that
they are able to carry out their duties
effectively.
Directors’ Remuneration Report
GOVERNANCE
Triple Point VCT 2011 plc
| 65
Annual Remuneration Report
Directors’ Fees
Details of each Director’s contract is shown below. The Chair is paid more than the other Directors to reflect the additional responsibilities of the
role.
Date of Contract
Unexpired term of
contract
Annual rate of
Directors’
fees (£)
Policy on payment for
loss of office
Jane Owen, Chair
23-Sep-10
none
22,500
none
Chad Murrin
23-Sep-10
none
18,000
none
Tim Clarke
05-May-11
none
18,000
none
Julian Bartlett
08-Feb-22
none
18,000
none
Single Total Figure (audited information)
The fees paid to Directors in respect of the year ended 28 February 2022 and the prior year are shown below:
Emoluments for
the year ended
28 February
2022
% Change from
2021-2022
Emoluments for
the Year ended
28 February
2021
% Change from
2020-2021
Emoluments for
the Year ended
28 February
2020
Emoluments for
the Year ended
28 February
2019
Emoluments for
the Year ended
28 February
2018
£
%
£
%
£
£
£
Jane Owen, Chair
22,500
–
22,500
–
22,500
17,500
17,500
Chad Murrin
18,000
–
18,000
–
18,000
15,000
15,000
Tim Clarke
18,000
–
18,000
–
18,000
15,000
15,000
Julian Bartlett
1,038
n/a
n/a
n/a
n/a
n/a
n/a
59,538
2
58,500
–
58,500
47,500
47,500
Employer’s NI
contributions
–
435
1,499
112
175
Total Emoluments
59,538
58,935
59,999
47,612
47,675
None of the Directors are eligible for bonuses, pension benefits, share options, long-term incentive schemes or other benefits in respect of their
services as Non-Executive Directors of the Company.
Information required on executive Directors, including the Chief Executive Officer and employees has been omitted because the Company has
neither and therefore it is not relevant.
Directors’ emoluments compared to payments to Shareholders:
Unaudited
28 February 2022
28 February 2021
£’000
£’000
Total Dividends paid
4,249
1,378
Total Directors’ emoluments
60
59
Directors’ Share Interests (audited information)
At 28 February 2022, Jane Owen held 24,624 A Shares, 24,378 B Shares and 73,086 Venture Shares (2021: 24,624 A Shares; 24,378 B Shares and
24,499 Venture Shares).
Tim Clarke held 24,624 B Shares and 96,762 Venture Shares (2021: 24,624 B Shares and 51,551 Venture Shares).
Chad Murrin held 24,874 A Shares, 24,624 B Shares and 46,938 Venture Shares (2021: 24,874 A Shares; 24,624 B Shares and 24,437 Venture
Shares).
Following the year-end on 1 March 2022 Julian Bartlett purchased 17,459 Venture Shares.
Directors’ Remuneration Report
GOVERNANCE
66 |
Triple Point VCT 2011 plc
No other connected parties to the Directors held any Shares at 28 February 2022 (2021: nil). Any Shares owned by the Directors were purchased at
the same price offered to investors. There are no requirements or restrictions on Directors holding Shares in the Company.
Company Performance
The following performance charts compare the Total Return of the A, B and Venture Share Classes over the period from 1 March 2017 to
28 February 2022 with the Total Return from notional investments in the FTSE All-Share index and FTSE Small-Cap index over the same period. The
indices chosen are considered to be the most appropriate broad equity markets for comparative purposes.
Investors should be reminded that Shares in Venture Capital Trusts generally continue to trade at a discount to the NAV of the Company.
The Total Return does not include the initial 30% tax relief available to investors.
A Ordinary Share Net Asset Value Total Return since launch against the FTSE Small-Cap Index Total Return & FTSE All Share Index Total Return
Total Return (p)
01 Aug 15
01 Feb 16
01 Feb 17
01 Feb 18
01 Feb 19
01 Feb 20
01 Aug 20
01 Feb 21
01 Feb 21
01 Aug 21
01 Feb 22
01 Aug 16
01 Aug 17
01 Aug 18
01 Aug 19
A Ordinary Share NAV Total Return rebased to 100p at launch
FTSE Small-Cap Total Return rebased to 100p at launch
FTSE All Share Total Return rebased to 100p at launch
90
100
110
120
130
140
150
160
170
180
B Ordinary Share Net Asset Value Total Return since launch against the FTSE Small-Cap Index Total Return & FTSE All Share Index Total Return
Total Return (p)
B Ordinary Share NAV Total Return rebased to 100p at launch
01 Aug 16
01 Feb 17
01 Feb 18
01 Feb 19
01 Aug 19
01 Feb 21
01 Aug 21
01 Feb 22
01 Aug 20
01 Feb 20
01 Aug 17
01 Aug 18
FTSE Small-Cap Total Return rebased to 100p at launch
FTSE All Share Total Return rebased to 100p at launch
50
70
90
110
130
150
Directors’ Remuneration Report
GOVERNANCE
Triple Point VCT 2011 plc
| 67
These charts have been prepared in accordance with Part 3 to Schedule 8 of the Companies Act 2006. The Company measures its performance
against its target returns as detailed in the Strategic Report.
As highlighted above, the charts do not take into account the tax benefit of investing in a VCT.
Statement of Voting at the Annual General Meeting
The resolutions to approve the Directors’ Remuneration Report was passed at the Annual General Meeting on 12 July 2021 and the Directors’
Remuneration Policy was passed at the Annual General Meeting on 9 July 2020. Details of the proxy votes in respect of the resolutions are as set out
below:
Voting for
Voting Against
Vote Withheld
Remuneration Report
98.43%
1.57%
0%
Remuneration Policy
99.47%
0.53%
0%
During the year, the Company did not receive any communications from Shareholders specifically regarding Directors’ pay.
On behalf of the Board.
JANE OWEN
Chair
27 May 2022
Venture Share Net Asset Value Total Return since launch against the FTSE Small-Cap Index Total Return
and FTSE All Share Index Total Return
Total Return (p)
B Ordinary Share NAV Total Return rebased to 100p at launch
01 Aug 19
01 Feb 20
01 Feb 21
01 Aug 21
01 Feb 22
01 Aug 20
FTSE Small-Cap Total Return rebased to 100p at launch
FTSE All Share Total Return rebased to 100p at launch
70
90
110
130
150
Directors’ Report
GOVERNANCE
68 |
Triple Point VCT 2011 plc
The Directors are pleased to present the Directors’ Report for the year
ended 28 February 2022.
The information that fulfils the requirements of the Corporate
Governance statement in accordance with rule 7.2 of the DTR can be
found in this Directors’ report on page 68 to 71 and in the
Governance section on pages 51 to 78 all of which is incorporated
into this Directors’ report by reference.
Directors
The Directors of the Company during the year were Jane Owen, Chad
Murrin, Tim Clarke and Julian Bartlett who was appointed as a
Director on 8 February 2022.
Principal Activity and Status
The principal activity of the Company is that of a Venture Capital Trust
(“VCT”) and its main activity is investing in companies involved in
venture, renewable energy, energy production and SME funding.
The Company has been approved as a VCT by HMRC, in accordance
with Section 274 of the Income Tax Act 2007 and, in the opinion of
the Directors, has conducted its affairs so as to enable it to continue
to obtain such approval. In order to maintain its status under VCT
legislation, a VCT must comply on a continuing basis with the
provisions of Section 274 and further details can be found on page
70.
The Company is registered in England as a Public Limited Company
(Registration number 07324448) and its Shares are listed on the main
market of the London Stock Exchange.
The Company was not at any time up to the date of this report a close
company within the meaning of S439 of the Corporation Tax Act
2010.
Post Balance Sheet Events
Further details of post balance sheet events can be seen in note 23 to
the Financial Statements.
Directors’ indemnity
The Company has indemnified Directors against certain liabilities
within its Articles of Association which may be incurred in the
execution of their office. This indemnity remains in force as at the
date of this report and will also indemnify any new directors that join
the Board. The Company has, as permitted by Section 233 of the
Companies Act 2006, maintained insurance cover on behalf of the
Directors and Company Secretary, indemnifying them against certain
liabilities which may be incurred by them in relation to the execution
of their office.
Research and Development
No expenditure on research and development was made during the
year (2021: Nil).
Management
TPIM acts as Investment Manager to the Company and has done since
incorporation.
To align its interests with shareholders, TPIM earns a performance fee for
the Venture Share Class if the total return (net asset value plus
distributions made) to holders of the Venture Shares exceeds their net
initial subscription price by an annual threshold of 3% per annum,
calculated on a compound basis.
To the extent that the total return
exceeds the threshold over the relevant period then a performance
incentive fee of 20% of the excess is payable to TPIM. In addition, TPIM
earns a performance fee for the A Share Class of 20% on distributions
exceeding 100 pence per share. The other principal terms of the
Company’s management agreement with TPIM are set out in note 5 to
the Financial Statements.
The Board has evaluated the performance of the Investment Manager
based on the returns generated since taking on the management of the
Fund and a review of the management contract and the services
provided in accordance with its terms. As required by the Listing Rules,
the Directors confirm that in their opinion the continuing appointment of
TPIM as Investment Manager on the terms agreed is in the best interests
of the Shareholders as a whole.
In reaching this conclusion the Directors
have taken into account the performance of the Company, other VCTs
managed by TPIM, and the service provided by TPIM to the Company.
Substantial Shareholdings
As at the date of this report no disclosures of major shareholdings had
been made to the Company under Disclosure and Transparency rule 5
(Vote Holder and Issuer Notification Rules).
Share Price Discount Policy
The Company has a share buy-back facility, committing to buy back
Shares at no more than a 5% discount to the prevailing NAV, subject to
the Directors’ discretion. We will be asking Shareholders at the Annual
General Meeting to extend the facility for the Company to purchase
Shares in the market. Shareholders should note that if they sell their
S
hares within five years of subscription, they forfeit any tax relief
obtained. If you are considering selling your Shares, please contact the
Investment Manager on 020 7201 8989.
Purchase of Own Shares
During the year, the Company purchased for cancellation 173,848
A Ordinary Shares, 46,556 B Ordinary Shares, and 252,401 Venture
Shares.
The Directors may exercise on behalf of the Company its powers to
purchase its own Shares to the extent permitted by Shareholders and
the articles of association.
Streamlined Energy and Carbon Reporting
The Company has outsourced operations to third parties and has no
significant greenhouse gas emissions from its direct operations and so
qualifies as a low energy user at under 40,000kWh and is therefore
exempt from disclosures on greenhouse gas emissions and energy
consumption.
Directors’ Report
GOVERNANCE
Triple Point VCT 2011 plc
| 69
The Company has invested in renewable energy, through its portfolio
of hydroelectric companies. It has also invested in two companies
which operate gas fired energy centres. Natural gas neatly bridges
the gap between environmentally unfriendly fossil fuels and more
irregular solar and wind power. Gas fired energy centres play an
important role in balancing the UK electricity network, which is
growing ever more reliant on renewable energy sources, as the nation
shifts towards a low-carbon economy.
More information on the hydro portfolio and the gas fired energy
centres can be found in the Investment Manager’s Review on pages
30 to 41.
Share Capital
As at 28 February 2022 the Company’s issued share capital amounted
to 42,981,511, consisting of 9,777,285 A Shares of 1p each, 6,758,795
B shares of 1p each and 26,445,431 Venture Shares of 1p each. As at
that date none of the issued Shares were held by the Company as
treasury Shares.
There are no restrictions on the transfer of securities in the Company
other than the Company’s Share Dealing Code and other certain
restrictions which may be impaired by law, for example, the Market
Abuse Regulation.
The Company is not aware of any agreements between holders of
securities that may result in restrictions on transferring securities in the
Company. There are no securities of the Company carrying special
rights with regards to the control of the Company in issue.
Annual General Meeting
The 2022 annual general meeting will be held on 14 July 2022.
Amendment of Articles of Association
The Company’s articles of association may be amended by the
members of the Company by special resolution (requiring a majority
of at least 75% of the persons voting on the relevant resolution).
Appointment and Replacement of Directors
A person may be appointed as a Director of the Company by the
Shareholders in general meeting by ordinary resolution (requiring a
simple majority of the persons voting on the relevant resolution) or by
the Directors. No person, other than a Director retiring by rotation or
otherwise, shall be appointed or re-appointed a Director at any
general meeting unless he is recommended by the Directors or, not
less than seven nor more than 42 clear days before the date
appointed for the meeting, notice is given to the Company of the
intention to propose that person for appointment or re-appointment
in the form and manner set out in the Company’s articles of
association.
Each Director who is appointed by the Directors (and who has not
been elected as a Director of the Company by the members at a
general meeting held in the interval since his appointment as a
Director of the Company) is to be subject to election as a Director of
the Company by the members at the first Annual General Meeting of
the Company following his or her appointment. Thereafter all
Directors are subject to re-election at each Annual General Meeting
of the Company.
A person also ceases to be a Director if he or she resigns in writing,
ceases to be a Director by virtue of any provision of the Companies
Act 2006, becomes prohibited by law from being a Director, becomes
bankrupt or is the subject of a relevant insolvency procedure, or
becomes of unsound mind, or if the Board so decides following at
least six months’ absence without leave or if he or she becomes
subject to relevant procedures under the mental health laws, as set
out in the Company’s articles of association.
Powers of the Directors
Subject to the provisions of the Companies Act, the memorandum
and articles of association of the Company and any directions given
by Shareholders by special resolution, the articles of association
specify that the business of the Company is to be managed by the
Directors, who may exercise all the powers of the Company, whether
relating to the management of the business or not.
Conflicts of Interests
The Directors review the disclosure of conflicts of interest quarterly,
with changes reviewed and noted at the beginning of each Board
meeting. A Director who has a potential conflict of interest has the
interest authorised and acknowledged by the Board. Procedures to
disclose and authorise conflicts have been adhered to throughout the
year.
Directors’ Responsibilities
The Directors confirm that:
•
so far as each of the Directors is aware there is no relevant
audit information of which the Company’s auditor is unaware;
and
•
the Directors have taken all steps that they ought to have
taken as Directors in order to make themselves aware of any
relevant audit information and to establish that the auditor is
aware of that information.
Auditor
BDO LLP is the appointed auditor of the Company and offer
themselves for reappointment. In accordance with section 489 (4) of
the Companies Act 2006 a resolution to reappoint BDO LLP as
auditor and to authorise the Directors to fix their remuneration will be
proposed at the forthcoming Annual General Meeting.
Going Concern
After making the necessary enquiries, the Directors confirm that they
are satisfied that the Company has adequate resources to continue in
business for at least the next 12 months. The Board receives regular
reports from the Investment Manager and the Directors believe that,
as no material uncertainties leading to significant doubt about going
concern have been identified, it is appropriate to continue to apply
the going concern basis in preparing the Financial Statements.
Further information on the Going Concern of the Company can be
Directors’ Report
GOVERNANCE
70 |
Triple Point VCT 2011 plc
found in the Strategic report on pages 25 to 26 and note 2 to the
financial statements on page
s 85 to 88.
Annual Report
The Board is of the opinion that the Annual Report, taken as a whole,
is fair, balanced and understandable and provides the information
necessary for Shareholders to assess the position, performance,
strategy and business model of the Company.
The Board recommends that the Annual Report, the Report of the
Directors and the Independent Auditor’s Report for the year ended
28 February 2022 are received and adopted by the Shareholders.
A resolution concerning this will be proposed at the forthcoming
Annual General Meeting.
VCT Regulation
The Investment Policy is designed to ensure that the Company
continues to qualify and is approved as a VCT by HMRC. In order to
maintain its status under Venture Capital Trust legislation, a VCT must
comply on a continuing basis with the provisions of section 274 of the
Income Tax Act 2007 as follows:
(1)
the Company’s income must be derived wholly or mainly from
Shares and securities;
(2)
at least 80% of the HMRC value of its investments must have
been represented throughout the year by Shares or securities
that are classified as “qualifying holdings”;
(3)
at least 70% by HMRC value of its total qualifying holdings must
have been represented throughout the year by holdings of
“eligible shares”;
(4)
at least 30% of funds raised in accounting periods beginning on
or after 6 April 2018 must be invested in qualifying holdings by
the anniversary of the end of the accounting period in which
funds were raised;
(5)
at the time of investment, or addition to an investment, the
Company’s holdings in any one company must not have
exceeded 15% by HMRC value of its investments;
(6)
the Company must not have retained greater than 15% of its
income earned in the year from Shares and securities;
(7)
the Company’s Shares, throughout the year, must have been
listed on a regulated European market;
(8)
an investment in any company must not cause that company to
receive more than £5 million in State aid risk finance in the 12
months up to date of the investment, nor more than £12 million
in total (the limits are £10 million and £20 million respectively for
a “knowledge intensive” company);
(9)
the Company must not invest in a company whose trade is more
than seven years old (ten years for a “knowledge intensive”
company) unless the company previously received State and risk
finance in its first seven years, or the company is entering a new
market and a turnover test is satisfied;
(10)
the Company’s investment in another company must not be used
to acquire another business, or Shares in another company; and
(11)
the Company may only make qualifying investments or certain
non-qualifying investments permitted by section 274 of the
Income Tax Act 2007.
Environment
The management and administration of the Company is undertaken
by the Investment Manager. TPIM recognises the importance of its
environmental responsibilities, monitors its impact on the
environment, and designs and implements policies to reduce any
damage that might be caused by its activities. Initiatives designed to
minimise the Company’s impact on the environment include recycling
and reducing energy consumption.
Anti-bribery Policy
The Company has a zero tolerance approach to bribery, and will not
tolerate bribery under any circumstances in any transaction the
Company is involved in.
TPIM reviews the anti-bribery policies and procedures of all portfolio
companies.
Environmental, Social, Employee and
Human Rights Issues
As the Company has no employees, it does not maintain specific
policies in relation to these matters. Due to the nature of the
Company’s activities, there being no employees and only four Non-
Executive Directors, there are no Human Rights issues to report. Its
investment in companies engaged in energy generation from
renewable sources means it has contributed to the reduction in
carbon emissions.
Directors’ Report
GOVERNANCE
Triple Point VCT 2011 plc
| 71
Diversity
The Board of Directors comprises one female and three male
Directors.
The Company does not have any employees or office space. As such
the Company does not operate a diversity policy with regards to any
administrative, management and supervisory functions.
Employees
The Company has no employees and accordingly no requirement to
separately report on this area.
The Investment Manager is an equal opportunities employer who
respects and seeks to empower each individual and the diverse
cultures, perspectives, skills and experiences within its workforce. The
Investment Manager places great importance on company culture
and the wellbeing of its employees and considers various initiatives
and events to support a positive work environment.
Investment and Co-Investment
The Company co-invests with other venture capital trusts and funds
managed by TPIM.
Matters Covered in the Strategic Report
The information that fulfils the reporting requirements relating to the
following matters can be found on the pages identified.
Matter
Page
Reference
Future Developments
7 to 15
Financial risk management objectives
56 to 57
Information on exposure to price risk, liquidity risk and cashflow risk
25
JANE OWEN
Chair
27 May 2022
Directors’ Responsibility Statement
GOVERNANCE
72 |
Triple Point VCT 2011 plc
The Directors are responsible for preparing the annual report and the
financial statements in accordance with UK adopted international
accounting standards and applicable law and regulations.
Company law requires the Directors to prepare financial statements
for each financial year.
Under that law the Directors are required to
prepare the Company financial statements in accordance with UK
adopted international accounting standards.
Under company law the
Directors must not approve the financial statements unless they are
satisfied that they give a true and fair view of the state of affairs of the
Company and of the profit or loss for the Company for that period.
In preparing these financial statements, the Directors are required to:
•
select suitable accounting policies and then apply them
consistently;
•
make judgements and accounting estimates that are
reasonable and prudent;
•
state whether they have been prepared in accordance with UK
adopted international accounting standards, subject to any
material departures disclosed and explained in the financial
statements;
•
prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Company will
continue in business;
•
prepare a Directors’ report, a strategic report and directors’
remuneration report which comply with the requirements of
the Companies Act 2006.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the company’s
transactions and disclose with reasonable accuracy at any time the
financial position of the company and enable them to ensure that the
financial statements comply with the Companies Act 2006.
They are also responsible for safeguarding the assets of the company
and hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities. The Directors are
responsible for ensuring that the annual report and accounts, taken as
a whole, are fair, balanced, and understandable and provides the
information necessary for Shareholders to assess the Company’s
performance, business model and strategy.
The Directors are responsible for ensuring the annual report and the
financial statements are made available on a website.
Financial
statements are published on the company’s website in accordance
with legislation in the United Kingdom governing the preparation and
dissemination of financial statements, which may vary from legislation
in other jurisdictions.
The maintenance and integrity of the company’s
website is the responsibility of the Directors.
The Directors’
responsibility also extends to the ongoing integrity of the financial
statements contained therein.
The Directors have delegated the hosting and maintenance of the
Company’s website content to TPIM and its materials are published
on the TPIM website www.triplepoint.co.uk. Legislation in the United
Kingdom governing the preparation and dissemination of Financial
Statements may differ from legislation in other jurisdictions.
Directors’ responsibilities pursuant to DTR4
The Directors confirm to the best of their knowledge:
•
the financial statements have been prepared in accordance
with the applicable set of accounting standards, give a true
and fair view of the assets, liabilities, financial position and
profit and loss of the Company
; and
•
the annual report includes a fair review of the development
and performance of the business and the financial position of
the Company, together with a description of the principal risks
and uncertainties that they face.
On behalf of the Board.
JANE OWEN
Chair
27 May 2022
INDEPENDENT
AUDITOR’S
REPORT
Independent auditor’s report
to the members of Triple Point VCT 2011 plc
GOVERNANCE
74 |
Triple Point VCT 2011 plc
Opinion on the financial statements
In our opinion:
•
the financial statements give a true and fair view of the state of
the Company’s affairs as at 28 February 2022 and of its profit
for the year then ended;
•
the financial statements have been properly prepared in
accordance with UK-adopted international accounting
standards; and
•
the financial statements have been prepared in accordance
with the requirements of the Companies Act 2006.
We have audited the financial statements of Triple Point VCT 2011 plc
(the ‘Company’) for the year ended 28 February 2022 which comprise
the Statement of Comprehensive Income, the Balance Sheet, the
Statement of Changes in Shareholders’ Equity, the Statement of Cash
Flows, and notes to the financial statements, including a summary of
significant accounting policies. The financial reporting framework that
has been applied in their preparation is applicable law and UK
adopted international accounting standards.
Basis for opinion
We conducted our audit in accordance with International Standards on
Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under
those standards are further described in the Auditor’s responsibilities
for the audit of the financial statements section of our report. We
believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion. Our audit opinion is
consistent with the additional report to the audit committee.
Independence
Following the recommendation of the audit committee, we were
appointed by the directors on 9th November 2017 to audit the financial
statements for the year ended 28 February 2018 and subsequent
financial periods. We were re-appointed by shareholders at the AGM
held on 25 June 2021 to audit the financial statements for the year
ending 28 February 2022. The period of total uninterrupted
engagement, including retenders and reappointments, is five years,
covering the years ending 28 February 2018 to 28 February 2022. We
remain independent of the Company in accordance with the ethical
requirements that are relevant to our audit of the financial statements in
the UK, including the FRC’s Ethical Standard as applied to listed public
interest entities, and we have fulfilled our other ethical responsibilities in
accordance with these requirements. The non-audit services prohibited
by that standard were not provided to the Company.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the
Directors’ use of the going concern basis of accounting in the
preparation of the financial statements is appropriate. Our evaluation
of the Directors’ assessment of the Company’s ability to continue to
adopt the going concern basis of accounting included:
•
Obtaining the VCT compliance reports (prepared by
management’s experts) during the year and as at year end and
reviewing the calculations therein to ensure that the Company
was meeting its requirements to retain VCT status.
•
Consideration of the Company’s expected future compliance
with VCT legislation, the absence of bank debt, contingencies
and commitments and any market or reputational risks.
•
Reviewing the forecasted cash flows that support the Directors’
assessment of going concern, challenging assumptions and
judgements made in the forecasts, and assessing them for
reasonableness. In particular we considered the available cash
resources relative to the forecast expenditure which was assessed
against the prior year for reasonableness.
•
Evaluating directors’ method of assessing the going concern in
light of market volatility and the present uncertainties in
economic recovery created by the ongoing Covid-19 pandemic.
•
Calculating financial ratios to ascertain the financial health of the
Company.
Based on the work we have performed, we have not identified any
material uncertainties relating to events or conditions that, individually
or collectively, may cast significant doubt on the Company’s ability to
continue as a going concern for a period of at least twelve months
from when the financial statements are authorised for issue.
In relation to the Company’s reporting on how it has applied the UK
Corporate Governance Code, we have nothing material to add or
draw attention to in relation to the Directors’ statement in the financial
statements about whether the Directors considered it appropriate to
adopt the going concern basis of accounting.
Our responsibilities and the responsibilities of the Directors with respect
to going concern are described in the relevant sections of this report.
Overview
2022
2021
Key audit matters
Valuation of
Yes
Yes
investments
Materiality
Company financial statements as a whole
£700,000 (2021:£410,000) based on 2% of net
assets (2021: 2% of value of the Investment
portoflio).
Specific materiality
Testing for items impacting on the realised return
was performed to a threshold of £45,000 (2021:
£35,000) based on 5% (2021: 5%) of total
expenditure excluding expenditure one-off in
nature i.e, performance fees
An overview of the scope of our audit
Our audit was scoped by obtaining an understanding of the Company
and its environment, including the Company’s system of internal
control, and assessing the risks of material misstatement in the
financial statements. We also addressed the risk of management
override of internal controls, including assessing whether there was
evidence of bias by the Directors that may have represented a risk of
material misstatement.
Key audit matters
Key audit matters are those matters that, in our professional judgement,
were of most significance in our audit of the financial statements of the
current period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) that we identified, including
those which had the greatest effect on: the overall audit strategy, the
allocation of resources in the audit, and directing the efforts of the
engagement team. This matter was addressed in the context of our
audit of the financial statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on this matter.
Independent auditor’s report
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GOVERNANCE
Triple Point VCT 2011 plc
| 75
Key audit matter
Valuation of Investments
See note 11 and note 17 and accounting policy on page 86.
100% of the underlying investment portfolio is represented by
unquoted equity and loan stock. There is a high level of estimation
uncertainty involved in determining the unquoted investments
valuations.
The Investment Manager’s fee and Performance fees are based on the
value of the net assets of the VCT (Performance fees based on
Venture class investment net assets). The Investment Manager is
responsible for preparing the valuation of investments which are
reviewed and approved by the Board. Notwithstanding this review,
there is a potential risk of misstatement in the investment valuations.
We therefore have determined the valuation of investments to be a
key audit matter.
How the scope of our audit addressed the key audit
matter
For all the investments held in the Venture share class (representing
85% of the portfolio), we have tested all the investments and
performed the following procedures:
•
Agreed inputs to valuations to third party data such as board
packs of underlying investee companies where appropriate;
•
Considered whether the valuation methodology was the most
appropriate in the circumstances under the International
Private Equity and Venture Capital Valuation (“IPEV”)
Guidelines and IFRS 13 – Fair Value Measurement (“IFRS 13”);
•
Re-performed the calculation of the value attributable to the
Company;
•
Verified and benchmarked key inputs and estimates to
independent information and our own research;
•
For investments held at the price of recent transaction, we
obtained evidence of the transaction price and considered
whether the terms of the transaction are relevant and form a
basis for the fair value at the year end, considering the
investment manager’s assessment of progress against
milestones;
•
Considered the economic environment in which the
investment operates to identify factors that could impact the
investment valuation.
In respect of the investments valued using discounted cash flow
models (“DCF”) (representing 15% of the portfolio), we have tested
all the investments and performed the following specific procedures:
•
Considered the appropriatness of overall fair value and
valuation movement in the period by;
•
Reviewed and challenged the key
assumptions including
discount factors, inflation, asset life, energy yield and power
price applied by benchmarking to available industry data and
verifying these to supporting evidence
•
Consulted with our internal valuations specialists on the
appropriateness of the assumptions, including the discount
rate, inflation, power price, and assets life.
•
Used spreadsheet analysis tools to assess the integrity of the
models;
•
Vouched cash balance with investee company management
accounts;
•
Performed sensitivity analysis by adjusting certain key inputs in
order to calculate a reasonable range of possible valuations
where appropriate; and
•
Considered the accuracy of forecasting by comparing previous
forecasts to actual results.
Key Observations:
Based on the procedures performed, consider the estimates and
judgements made in the valuation of investments to be appropriate.
Independent auditor’s report
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GOVERNANCE
76 |
Triple Point VCT 2011 plc
Our application of materiality
We apply the concept of materiality both in planning and performing
our audit, and in evaluating the effect of misstatements.
We consider
materiality to be the magnitude by which misstatements, including
omissions, could influence the economic decisions of reasonable
users that are taken on the basis of the financial statements.
In order to reduce to an appropriately low level the probability that
any misstatements exceed materiality, we use a lower materiality
level, performance materiality, to determine the extent of testing
needed. Importantly, misstatements below these levels will not
necessarily be evaluated as immaterial as we also take account of the
nature of identified misstatements, and the particular circumstances of
their occurrence, when evaluating their effect on the financial
statements as a whole.
Based on our professional judgement, we determined materiality for
the financial statements as a whole and performance materiality as
follows:
2022
2021
Materiality
£700,000
£410,000
Basis for
determining
materiality
2% of net assets
2% of the value of
the investment
portfolio
Rationale for the
benchmark applied
In setting materiality, we have had regard to
the nature and disposition of the investment
portfolio. Given that the VCT’s portfolio is
comprised of unquoted investments which
would typically have a wider spread of
reasonable alternative possible valuations,
we have applied a percentage of 2% of net
assets (2021: 2% of the investment
portfolio).
This was changed from the prior year
benchmark of gross investment value to
align to a standardised benchmark across
the investment company sector.
Performance
materiality
£525,000
£315,000
Basis for
determining
performance
materiality
We set performance materiality at 75% of
Materiality (2021:75%) based on our risk
assessment of the control environment and
consideration of number of historical errors
identified
Specific materiality
We also determined that for items impacting realised return, a
misstatement of less than materiality for the financial statements as a
whole, specific materiality, could influence the economic decisions of
users. As a result, we determined materiality for these items based on
5% of total expenditure (2021: 5% of total expenditure), this being
£45,000 (2021: £35,000). We further applied a performance
materiality level of 75% of specific materiality to ensure that the risk of
errors exceeding specific materiality was appropriately mitigated.
Reporting threshold
We agreed with the Audit Committee that we would report to them
all individual audit differences in excess of £14,000 (2021: £8,000). We
also agreed to report differences below this threshold that, in our
view, warranted reporting on qualitative grounds.
Other information
The directors are responsible for the other information. The other
information comprises the information included in the Annual Report
other than the financial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other
information and, except to the extent otherwise explicitly stated in
our report, we do not express any form of assurance conclusion
thereon. Our responsibility is to read the other information and, in
doing so, consider whether the other information is materially
inconsistent with the financial statements or our knowledge obtained
in the course of the audit, or otherwise appears to be materially
misstated. If we identify such material inconsistencies or apparent
material misstatements, we are required to determine whether this
gives rise to a material misstatement in the financial statements
themselves. If, based on the work we have performed, we conclude
that there is a material misstatement of this other information, we are
required to report that fact.
We have nothing to report in this regard.
Corporate governance statement
The Listing Rules require us to review the Directors’ statement in
relation to going concern, longer-term viability and that part of the
Corporate Governance Statement relating to the Company’s
compliance with the provisions of the UK Corporate Governance
Statement specified for our review.
Based on the work undertaken as part of our audit, we have
concluded that each of the following elements of the Corporate
Governance Statement is materially consistent with the financial
statements or our knowledge obtained during the audit.
Going concern and longer-term viability
•
The Directors’ statement with regards the appropriateness of
adopting the going concern basis of accounting and any
material uncertainties identified set out on pages 25 to 26; and
•
The Directors’ explanation as to its assessment of the entity’s
prospects, the period this assessment covers and why they
period is appropriate set out on page 26.
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| 77
Other Code provisions
•
Directors’ statement on fair, balanced and understandable set
out on page 70;
•
Board’s confirmation that it has carried out a robust assessment
of the emerging and principal risks on page 24;
•
The section of the annual report that describes the review of
effectiveness of risk management and internal control systems
set out on page on page 56; and
•
The section describing the work of the audit committee set
out on page 59.
Other Companies Act 2006 reporting
Based on the responsibilities described below and our work
performed during the course of the audit, we are required by the
Companies Act 2006 and ISAs (UK) to report on certain opinions and
matters as described below.
Strategic report and Directors’ report
In our opinion, based on the work undertaken in the course of the
audit:
•
the information given in the Strategic report and the Directors’
report for the financial year for which the financial statements
are prepared is consistent with the financial statements; and
•
the Strategic report and the Directors’ report have been
prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the
Company
and its environment obtained in the course of the audit, we have not
identified material misstatements in the strategic report or the
Directors’ report.
Directors’ remuneration
In our opinion, the part of the Directors’ remuneration report to be
audited has been properly prepared in accordance with the
Companies Act 2006.
Matters on which we are required to report by
exception
We have nothing to report in respect of the following matters in
relation to which the Companies Act 2006 requires us to report to you
if, in our opinion:
•
adequate accounting records have not been kept by the
Company, or returns adequate for our audit have not been
received from branches not visited by us; or
•
the Company’s financial statements and the part of the
Directors’ remuneration report to be audited are not in
agreement with the accounting records and returns; or
•
certain disclosures of Directors’ remuneration specified by law
are not made; or
•
we have not received all the information and explanations we
require for our audit.
Responsibilities of Directors
As explained more fully in the Directors’ Responsibility Statement, the
Directors are responsible for the preparation of the financial
statements and for being satisfied that they give a true and fair view,
and for such internal control as the Directors determine is necessary
to enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, the Directors are responsible for
assessing the Company’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless the Directors either
intend to liquidate the Group or the Parent Company or to cease
operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of
the financial statements
Our objectives are to obtain reasonable assurance about whether the
financial statements as a whole are free from material misstatement,
whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of
assurance, but is not a guarantee that an audit conducted in
accordance with ISAs (UK) will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users
taken on the basis of these financial statements.
Extent to which the audit was capable of detecting
irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with
laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements in
respect of irregularities, including fraud. The extent to which our
procedures are capable of detecting irregularities, including fraud is
detailed below:
We gained an understanding of the legal and regulatory framework
applicable to the Company and the industry in which it operates, and
considered the risk of acts by the Company which were contrary to
applicable laws and regulations, including fraud. These included but
were not limited to compliance with Companies Act 2006, the FCA
listing and DTR rules, the principles of the UK Corporate Governance
Code, industry practice represented by the Statement of
Recommended practice: Financial Statements of Investment Trust
Companies and Venture Capital Trusts (“the SORP”) and updated in
February 2018 with consequential amendments and the applicable
financial reporting framework. We also considered the Company’s
qualification as a VCT under UK tax legislation.
Our procedures included:
•
Obtaining an understanding of the control environment in
monitoring compliance with laws and regulations;
•
Agreement of the financial statement disclosures to underlying
supporting documentation;
Independent auditor’s report
to the members of Triple Point VCT 2011 plc
GOVERNANCE
78 |
Triple Point VCT 2011 plc
•
Enquiries of management and those charged with governance
of their knowledge of actual or suspected fraud or instances of
non-compliance with laws and regulations;
•
Obtaining the VCT compliance reports [prepared by
management’s expert] during the year and as at year end and
reviewing their calculations to check that the Company was
meeting its requirements to retain VCT status; and
•
Reviewing minutes of board meetings and legal
correspondence and invoices throughout the period for
instances of non-compliance with laws and regulations and
fraud.
We assessed the susceptibility of the financial statement to material
misstatement including fraud and considered the fraud risk areas to
be the valuation of unquoted investments and management override
of controls.
Our tests included, but were not limited to:
•
The procedures set out in the Key Audit Matters section above;
•
Obtaining independent evidence to support the ownership of
investments;
•
Recalculating investment management fees in total;
•
Obtaining independent confirmation of bank balances; and
•
Testing journals which met a defined risk criteria by agreeing to
supporting documentation and evaluating whether there was
evidence of bias by the Investment Manager and Directors that
represented a risk of material misstatement due to fraud.
We also communicated relevant identified laws and regulations and
potential fraud risks to all engagement team members and remained
alert to any indications of fraud or non-compliance with laws and
regulations throughout the audit.
Our audit procedures were designed to respond to risks of material
misstatement in the financial statements, recognising that the risk of
not detecting a material misstatement due to fraud is higher than the
risk of not detecting one resulting from error, as fraud may involve
deliberate concealment by, for example, forgery, misrepresentations
or through collusion. There are inherent limitations in the audit
procedures performed and the further removed non-compliance with
laws and regulations is from the events and transactions reflected in
the financial statements, the less likely we are to become aware of it.
A further description of our responsibilities is available on the
Financial Reporting Council’s website at: www.frc.org.uk/auditors
responsibilities.
This description forms part of our auditor’s report.
Use of our report
This report is made solely to the Company’s members, as a body, in
accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the
Parent Company’s members those matters we are required to state to
them in an auditor’s report and for no other purpose.
To the fullest
extent permitted by law, we do not accept or assume responsibility to
anyone other than the Parent Company and the Parent Company’s
members as a body, for our audit work, for this report, or for the
opinions we have formed.
PETER SMITH
(Senior Statutory Auditor)
For and on behalf of BDO LLP, Statutory Auditor
London, United Kingdom
27 May 2022
BDO LLP is a limited liability partnership registered in England and
Wales (with registered number OC305127).
FINANCIAL
STATEMENTS
Statement of Comprehensive Income
For the year ended 28 February 2022
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Triple Point VCT 2011 plc
FINANCIALS
28 February 2022
28 February 2021
Note
Revenue
Capital
Total
Revenue
Capital
Total
£’000
£’000
£’000
£’000
£’000
£’000
Investment Return/(loss)
4
Loss on investments
(334 )
(334 )
(2,485 )
(2,485 )
Gain/(loss) arising on the revaluation
of investments at the period end
Investment return/(loss)
(2,485 )
(2,111 )
Investment management fees
5
Other expenses
6
(94 )
Performance Fee
5
Profit/(loss) before taxation
(942 )
(240 )
(2,569 )
(2,809 )
Taxation
9
(58 )
(15 )
(73 )
Profit/(loss) after taxation
(1,000 )
(199 )
(2,553 )
(2,752 )
Other comprehensive income
Total comprehensive income/(loss)
(1,000 )
(199 )
(2,553 )
(2,752 )
Basic & diluted earnings/(loss) per share (pence)
A Share
10
(3.17 p)
(2.17 p)
(0.22 p)
B Share
10
(1.04 p)
(1.36 p)
(39.05 p)
(40.41 p)
Venture Share
10
(4.26 p)
(2.17 p)
(1.16 p)
The total column of this statement is the Statement of Comprehensive Income of the Company prepared in accordance with UK-adopted
International Financial Reporting Standards (IFRS). The supplementary revenue return and capital columns have been prepared in accordance with
the Association of Investment Companies Statement of Recommended Practice (AIC SORP) in so far as it does not conflict with IFRS.
All revenue and capital items in the above statement derive from continuing operations.
This Statement of Comprehensive Income includes all recognised gains and losses.
The loss on investment has arisen due to the sale of assets at a price of £3.96m which is below its carrying value of £4.30m which is equal to the fair
value at 28 February 2021 leading to a realised loss of £0.33m. The unrealised gain recognised on the assets through revaluations over time since
inception amounted to £7.36m.
The accompanying notes on pages 84 to 98 form an integral part of these statements.
Balance Sheet
At 28 February 2022
Triple Point VCT 2011 plc
| 81
FINANCIALS
28 February 2022
28 February 2021
Note
£’000
£’000
Non-current assets
Financial assets at fair value through profit or loss
11
Current assets
Receivables
13
Cash and cash equivalents
14
Total assets
Current liabilities
Payables and accrued expenses
15
Current taxation payable
(58 )
Net assets
Equity attributable to equity holders
Share capital
16
Share Premium
Share redemption reserve
Special distributable reserve
Capital reserve
(1,296 )
Revenue reserve
(1,199 )
(199 )
Total equity
Shareholders’ funds
Net asset value per A Share
18
Net asset value per B Share
18
Net asset value per Venture Share
18
The statements were approved by the Directors and authorised for issue on 27 May 2022 and are signed on their behalf by:
On behalf of the Board.
JANE OWEN
Chair
27 May 2022
The accompanying notes on pages 84 to 98 form an integral part of these statements.
Company No: 07324448
Statement of Changes in Shareholders’ Equity
For the year ended 28 February 2022
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Triple Point VCT 2011 plc
FINANCIALS
Issued
Capital
Share
Premium
Share
Redemption
Reserve
Special
Distributable
Reserve
Capital
Reserve
Revenue
Reserve
Total
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Year ended 28 February 2022
Opening balance
(1,296 )
(199 )
Issue of share capital
Cost of issue of Shares
(340 )
(340 )
Share buybacks
(5 )
(356 )
(356 )
Dividends paid
(4,249 )
(4,249 )
Transactions with owners
(4,605 )
Profit/(loss) before taxation
(942 )
Taxation
(15 )
(58 )
(73 )
Profit after taxation
(1,000 )
Other comprehensive income
Total comprehensive gains/(loss) for the period
(1,000 )
Balance at 28 February 2022
(1,199 )
The Capital Reserve consists of:
Investment holding gains
5,272
Other realised losses
(665)
4,607
Year ended 28 February 2021
Opening balance
(1 )
Issue of share capital
Cost of issue of Shares
(231 )
(231 )
Share buybacks
(6,756 )
Dividends paid
(1,378 )
(1,378 )
Transactions with owners
Loss before taxation
(2,569 )
(240 )
(2,809 )
Taxation
Loss after taxation
(2,553 )
(199 )
(2,752 )
Other comprehensive income
Total comprehensive loss for the period
(2,553 )
(199 )
(2,752 )
Balance at 28 February 2021
(1,296 )
(199 )
The Capital Reserve consists of:
Investment holding gains
(1,099)
Other realised losses
(197)
(1,296)
The capital reserve represents the proportion of Investment Management fees charged against capital and realised/unrealised gains or losses on the
disposal/revaluation of investments. The unrealised element of the capital reserve is not distributable.
The special distributable reserve was created on court cancellation of the share premium account. The revenue reserve, realised capital reserve and
special distributable reserve are distributable by way of dividend.
At 28 February 2022 the total reserves available for distribution are £3,187,371 (2021: £9,261,000). This consists of the special distributable reserve
net of the realised capital loss and revenue reserve. To maintain VCT status amounts in the special distributable reserve are not distributable until
after the 3rd accounting period following the relevant allotments of share capital.
Statement of Cash Flows
For the year ended 28 February 2022
Triple Point VCT 2011 plc
| 83
FINANCIALS
Year ended
28 February 2022
Year ended
28 February 2021
£’000
£’000
Cash flows from operating activities
Profit/(loss) before taxation
(2,809 )
(Profit)/loss arising on the disposal of investments during the period
(Gain)/loss arising on the revaluation of investments at the period end
(7,359 )
Cash flow generated by operations
(2,049 )
(324 )
(Increase)/decrease in receivables
Increase/(decrease) in payables
Cash flow (utilised in)/operating activities
(1,074 )
(158 )
Adjustment for non-cash items:
Foreign exchange (gain)/loss
(94 )
Increase/(decrease in taxation
Net cash flows from operating activities
(1,168 )
(101 )
Cash flows from investing activities
Purchase of financial assets at fair value through profit or loss
(8,988 )
(3,780 )
Disposal of financial assets at fair value through profit or loss
Net cash flows from investing activities
(5,027 )
(3,230 )
Cash flows from financing activities
Issue of Shares
Cost of Share issue
(356 )
(231 )
Dividends paid
(4,249 )
(1,378 )
Net cash flows from financing activities
Net increase in cash and cash equivalents
Reconciliation of net cash flow to movements in cash and cash equivalents
Cash and cash equivalents at 1 March 2021
Net increase in cash and cash equivalents
Cash and cash equivalents at 28 February 2022
The accompanying notes on pages 84 to 98 form an integral part of these statements.
NOTES
TO THE
FINANCIAL
STATEMENTS
Triple Point VCT 2011 plc
| 85
FINANCIALS
Notes to the Financial Statements
1. Corporate Information
The Financial Statements of the Company for the year ended
28 February 2022 were authorised for issue in accordance with a
resolution of the Directors on 27 May 2022.
The Company applied for listing on the London
24 December 2010.
Britain and registered in England and Wales.
The address of the
Company’s registered office, which is also its principal place of
business, is 1 King William Street, London, EC4N 7AF .
The Company is required to nominate a functional currency, being the
currency in which the Company predominantly operates. The
functional and reporting currency is pounds sterling (£), reflecting the
primary economic environment in which the Company operates.
The principal activity of the Company is investment. The Company’s
investment strategy is to offer combined exposure to cash, or cash-
based funds and venture capital investments.
2.
Basis of Preparation and Accounting
Policies
Basis of Preparation
The Financial Statements of the Company for the year to
28 February 2022 have been prepared in accordance with UK-
adopted international accounting standards and the applicable legal
requirements of the Companies Act 2006 and comply with the
Statement of Recommended Practice: “Financial Statements of
Investment Trust Companies and Venture Capital Trusts” (“SORP”)
issued by the Association of Investment Companies (“AIC”) in
April 2021.
The Financial Statements are prepared on a historical cost basis
except that investments are shown at fair value through profit or loss
(“FVTPL”).
Going Concern
After making the necessary enquiries, the Directors confirm that they
are satisfied that the Company has adequate resources to continue in
business for at least
five
more years. The Board receives regular
reports from the Investment Manager and the Directors believe that,
as no material uncertainties leading to significant doubt about going
concern have been identified, it is appropriate to continue to apply
the going concern basis in preparing the Financial Statements.
At the Balance Sheet date, the Company had a cash Balance of £6.25
million. Following the period end, the Company has also raised
further capital of circa £11.2 million. Whilst 30% of this new fund raise
needs to be deployed in 12 months under VCT legislation, this still
leaves the Company a sufficient cash runway to continue to meet its
liabilities as they fall due. Other than Investment Management fees &
dividends, the Company has a low level of non-discretionary cash
outflows. Should cash flow come under pressure, the Company has
the option to suspend dividends and negotiate deferral of investment
management fees. The impact on the business of the Ukraine-Russia
war is set out further in the Chair’s statement on pages 7 to 15 and
Investment Manager’s review on pages 30 to 41.
On this basis, the Directors believe the going concern basis is and
continues to be appropriate.
Critical Accounting Judgements and Estimates
The preparation of Financial Statements in conformity with IFRS
requires management to make judgements, estimates and
assumptions that affect the application of policies and the reported
amounts of assets and liabilities, income and expenses. The estimates
and associated assumptions are based on historical experience and
various other factors believed to be reasonable under the
circumstances, the results of which form the basis of making the
judgements about carrying values of assets and liabilities that are not
readily apparent from other sources.
Actual results may differ from
these judgements.
The judgements, estimates and assumptions that have a significant
risk of causing a material adjustment to the carrying amounts of assets
and liabilities relate to:
•
the valuation of unlisted financial investments held at fair value
through profit or loss, which are valued on the basis noted
below (under the heading Non-Current Asset Investments) and
in note 11;
•
the recognition or otherwise of accrued income on loan notes
and similar instruments granted to investee companies, which
are assessed in conjunction with the overall valuation of
unlisted financial investments as noted above; and
•
the previously uncharged investment management fees, which
are discussed further below in note 5.
The key judgements made by Directors are in the valuation of non-
current assets and the assessment of realised losses. The estimates
and underlying assumptions are reviewed on an ongoing basis.
Revisions to accounting estimates are recognised in the period in
which the estimate is revised if the revision affects that period or in
the period of revision and future periods if the revision affects both
current and future periods. The carrying value of investments is
disclosed in note 11.
Useful lives of the Company’s Hydro and Gas Power portfolio are
based on the Investment Manager’s estimates of the period over
which the assets will generate revenue which are periodically
reviewed for continued appropriateness. Climate Change may have
an impact on the estimated useful life of these assets. The actual
useful lives may be a shorter or longer period depending on the
actual operating conditions experienced by the asset.
The Directors do not believe that there are any further key
judgements made in applying accounting policies or estimates in
respect of the Financial Statements.
Accounting Policies
These accounting policies have been applied consistently in
preparing these Financial Statements.
86 |
Triple Point VCT 2011 plc
FINANCIALS
Notes to the Financial Statements
New and amended standards and interpretations
applied
The Interest Rate Benchmark Reform (Phase II) – Amendments to
IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 was effective for annual
periods beginning on or after 1 January 2021, and provide a number
of reliefs, all which apply to all hedging relationships that are directly
affected by interest rate benchmark reform. These amendments have
had no impact on the financial statements of the Company.
A number of new standards and amendments to standards are
effective for the annual periods beginning after 1 January 2022. None
of these are expected to have a significant effect on the measurement
of the amounts recognised in the financial statements of the
Company. The Company intends to adopt the standards and
interpretations in the reporting period when they become effective
and the Board does not anticipate that the adoption of these
standards and interpretations in future periods will materially impact
the Company’s financial results in the period of initial application
although there may be revised presentations to the financial
statements and additional disclosures.
New and amended standards and interpretations
not applied
The relevant new and amended standards and interpretations that are
issued, but not yet effective, up to the date of issuance of the
Company’s financial statements are disclosed below. These standards
are not expected to have a material impact on the entity in future
reporting periods and on foreseeable future transactions.
Amendments to IAS 1: Classification of Liabilities as Current or
Non-current
In January 2020, the IASB issued amendments to paragraphs 69 to 76
of IAS 1 to specify the requirements for classifying liabilities as current
or non-current. The amendments are effective for annual reporting
periods beginning on or after 1 January 2023.
Reference to the Conceptual Framework – Amendments to
IFRS 3
In May 2020, the IASB issued Amendments to IFRS 3 Business
Combinations – Reference to the Conceptual Framework. The
amendments are effective for annual reporting periods beginning on
or after 1 January 2022.
Definition of Accounting Estimates – Amendments to IAS 8
In February 2021, the IASB issued amendments to IAS 8, in which it
introduces a definition of
“accounting estimates”. The amendments
are effective for annual reporting periods beginning on or after
1 January 2023.
Disclosure of Accounting Policies – Amendments to IAS 1 and
IFRS Practice Statement 2
In February 2021, the IASB issued amendments to IAS 1 and IFRS
Practice Statement 2 Making Materiality Judgements. The
amendments to IAS 1 are applicable for annual periods beginning on
or after 1 January 2023.
Presentation of Statement of Comprehensive
Income
In order better to reflect the activities of a Venture Capital Trust, and
in accordance with the guidance issued by the Association of
Investment Companies, supplementary information which analyses
the Statement of Comprehensive Income between items of a revenue
and capital nature has been presented alongside the Income
Statement.
Non-Current Asset Investments
The Company invests in financial assets with a view to profiting from
their total return through income and capital growth. These
investments are managed, and their performance is evaluated on a
fair value basis in accordance with the investment policy detailed in
the Strategic Report on pages 6 to 50 and information about the
portfolio is provided internally on that basis to the Company’s Board
of Directors. Accordingly, upon initial recognition the investments are
classified by the Company as “at fair value through profit or loss” in
accordance with IFRS 9.
They are included initially at fair value, which is taken to be their cost
(excluding expenses incidental to the acquisition which are written off
in the Statement of Comprehensive Income and allocated to “capital”
at the time of acquisition).
Subsequently the investments are valued
at “fair value” which is the price that would be received to sell an
asset or paid to transfer a liability (exit price) in an orderly transaction
between market participants at the measurement date.
This is measured as follows:
•
Unlisted investments are fair valued by the Directors in
accordance with the International Private Equity and Venture
Capital Valuation Guidelines.
Fair value is established by using
measurements of value such as calibrating to the initial cost of
investment, latest funding rounds for our Venture investments
and discounted cash flows
.
The Board believe that those investments valued based on the
transaction price are done so because the transaction price is still
representative of fair value.
Where securities are classified upon initial recognition at fair value
through profit or loss, gains and losses arising from changes in fair
value are included in the Statement of Comprehensive Income for the
year as capital items in accordance with the AIC SORP 2021. The
profit or loss on disposal is calculated net of transaction costs of
disposal.
Investments are recognised as financial assets on legal completion of
the investment contract and are de-recognised on legal completion of
the sale of an investment.
The Company has taken the exemption permitted by IAS 28
“Investments in Associates and Joint Ventures” and IFRS 11 “Joint
Arrangements” for entities similar to investment entities and measures
its investments in associates and joint ventures at fair value. The
Directors consider an associate to be an entity over which the
Company has significant influence, through an ownership of between
20% and 50%. The Company’s associates and joint ventures are
disclosed in note 12.
Triple Point VCT 2011 plc
| 87
FINANCIALS
Notes to the Financial Statements
Income
Investment income includes interest earned on bank balances and
investment loans and includes income tax withheld at source.
Dividend income is shown net of any related tax credit and is brought
into account on the ex-dividend date.
Fixed returns on investment loans and debt are recognised on a time
apportionment basis so as to reflect the effective yield, provided there
is no reasonable doubt that payment will be received in due course.
Expenses
All expenses are accounted for on the accruals basis. Expenses are
charged to revenue with the exception of the investment management
exit fee which has been charged to the capital account and the
investment management fee which has been charged 75% to the
revenue account and 25% to the capital account to reflect, in the
Directors’ opinion, the expected long-term split of returns in the form
of income and capital gains respectively from the investment portfolio.
From 1 March 2022, the investment management fee will be charged
10% to the revenue account and 90% to the capital account
recognising the significant increase to the Venture investments and the
expected nature of returns from them.
The Company’s general expenses are split between the Share Classes
using the net asset value of each Share Class divided by the total net
asset value of the Company.
Taxation
Corporation tax payable is applied to profits chargeable to
corporation tax, if any, at the current rate in accordance with IAS 12
“Income Taxes”. The tax effect of different items of income/gain and
expenditure/loss is allocated between capital and revenue on the
“marginal” basis as recommended by the AIC SORP 2021.
In accordance with IAS 12, deferred tax is recognised using the
balance sheet method providing for temporary differences between
the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for taxation purposes. A deferred tax
asset is recognised to the extent that it is probable that future taxable
profits will be available against which the temporary difference can be
utilised. Deferred tax is measured at the tax rates that are expected to
be applied to the temporary differences when they reverse, based on
the laws that have been enacted or substantively enacted by the
reporting date. The Directors have considered the requirements of
IAS 12 and do not believe that any provision should be made.
Financial Instruments
The Company’s principal financial assets are its investments and the
accounting policies in relation to those assets are set out above.
Financial liabilities and equity instruments are classified according to
the substance of the contractual arrangements entered.
An equity instrument is any contract that evidences a residual interest
in the assets of the entity after deducting all of its financial liabilities.
Where the contractual terms of share capital do not have any terms
meeting the definition of a financial liability then this is classed as an
equity instrument.
Financial assets and financial liabilities are recognised in the
Company’s Statement of Financial Position when the Company
becomes a party to the contractual provisions of the instrument.
At
28 February 2022 and 28 February 2021 the carrying amounts of cash
and cash equivalents, receivables, payables, accrued expenses and
short-term borrowings reflected in the financial statements are
reasonable estimates of fair value in view of the nature of these
instruments or the relatively short period of time between the original
instruments and their expected realisation.
Financial Assets
The classification of financial assets at initial recognition depends on
the purpose for which the financial asset was acquired and its
characteristics. All financial assets are initially recognised at fair value.
All purchases of financial assets are recorded at the date on which the
Company became party to the contractual requirements of the
financial asset.
The Company’s financial assets principally comprise of investments
held at fair value through profit or loss and loans and receivables.
The company holds trade receivables with the objective to collect the
contractual cash flows and therefore measures them subsequently at
amortised cost using the effective interest method.
Investments are designated upon initial recognition as held at fair
value through profit or loss. Gains or losses resulting from the
movement in fair value are recognised in the Statement of
Comprehensive Income at each valuation date.
The Company’s loan and equity investments are held at fair value
through profit or loss. Gains or losses resulting from the movement in
fair value are recognised in the Company’s Statement of
Comprehensive Income at each valuation date.
Financial assets are recognised/derecognised at the date of the
purchase/disposal. Investments are initially recognised at cost, being
the fair value of consideration given. Transaction costs are recognised
in the Consolidated Statement of Comprehensive Income as incurred.
Fair value is defined as the amount for which an asset could be
exchanged between knowledgeable willing parties in an arm’s length
transaction. Fair value is calculated on an unlevered, discounted cash
flow basis in accordance with IFRS 13 and IFRS 9.
Derecognition of financial assets (in whole or in part) takes effect:
•
When the Company has transferred substantially all the risks
and rewards of ownership; or
•
When it has neither transferred or retained substantially all the
risks and rewards and when it no longer has control over the
assets or a portion of the asset; or
•
When the contractual right to receive cash flow has expired.
Financial liabilities
Financial liabilities are classified according to the substance of the
contractual agreements entered into and are recorded on the date on
which the Company becomes party to the contractual requirements of
the financial liability.
All loans and borrowings are initially recognised at cost, being fair
value of the consideration received, less issue costs where applicable.
After initial recognition, all interest-bearing loans and borrowings are
subsequently measured at amortised cost using the effective interest
rate method.
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Triple Point VCT 2011 plc
FINANCIALS
Notes to the Financial Statements
Although not appropriate for this reporting date, loan balances at the year-end would not usually be discounted to reflect amortised cost, as the
amounts would not usually be materially different from the outstanding balances.
The Company’s other financial liabilities measured at amortised cost include trade and other payables which are initially recognised at fair value and
subsequently measured at amortised cost using the effective interest rate method.
A financial liability (in whole or in part) is derecognised when the Company has extinguished its contractual obligations, it expires or is cancelled.
Any gain or loss on derecognition is taken to the Consolidated Statement of Comprehensive Income.
Issued Share Capital
A Shares, B Shares and Venture Shares are classified as equity because they do not contain an obligation to transfer cash or another financial asset.
Issue costs associated with the allotment of Shares have been deducted from the share premium account in accordance with IAS 32.
The Company had no external debt at the reporting date; consequently, all capital is represented by the value of share capital, distributable and
other reserves. Total Shareholder equity at 28 February 2022 was £35.17 million (2021: £23.33 million).
Cash and Cash Equivalents
Cash and cash equivalents representing cash available at less than three months’ notice are classified as Financial Assets at amortised cost under
IFRS 9.
Reserves
The revenue reserve (retained earnings) and capital reserve reflect the guidance in the AIC SORP. The capital reserve represents the proportion of
Investment Management fees charged against capital and realised/unrealised gains or losses on the disposal/revaluation of investments. The
unrealised capital reserve is not distributable.
An element of the special distributable reserve was created on court cancellation of the share premium account and has been available for
distribution since 1 March 2019.
The revenue reserve, the portion of the capital reserve representing realised capital profits
and losses less unrealised gains and the special
distributable reserve are distributable by way of dividend.
Foreign currencies
Transactions in foreign currencies are translated at the foreign exchange rate ruling at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated at the foreign exchange rate ruling at that
date. Foreign exchange differences arising on translation are recognised in the Statement of Comprehensive Income.
Dividends
Dividends payable are recognised as distributions in the financial statements when the Company’s obligation to make payment has been
established.
3. Segmental Reporting
The Directors are of the opinion that the Company only has a single operating segment of business, being investment activity.
All revenues and assets are generated and held in the UK.
4. Investment Income
Year ended
28 February 2022
Year ended
28 February 2021
A
Shares
B
Shares
Venture
Shares
Total
A
Shares
B
Shares
Venture
Shares
Total
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Interest receivable on bank balances
–
–
3
3
1
1
7
9
Loan interest
209
–
23
232
338
–
27
365
209
–
26
235
339
1
34
374
Disclosure by share class is unaudited.
Triple Point VCT 2011 plc
| 89
FINANCIALS
Notes to the Financial Statements
5. Investment Management Fees
TPIM provides investment management and administration services to the Company under an Investment Management Agreement effective 23
September 2010 and a deed of variation to that agreement effective 14 September 2018.
A Shares:
The agreement provides for an investment management fee of 2.00% per annum of net assets payable quarterly in arrear for A Shares.
For A Shares, the appointment shall continue for a period of at least 6 years from the admission of those Shares.
B Shares:
The agreement provides for an investment management fee of 1.90% per annum of net assets payable quarterly in arrear for B Shares.
For B Shares, the appointment shall continue for a period of at least 6 years from the admission of those Shares.
Venture:
The agreement provides for an investment management fee of 2.00% per annum of net assets payable quarterly in arrear for Venture
Shares. For Venture Shares, the appointment shall continue for a period of at least 6 years from the admission of those Shares.
Following a deed of variation to the Investment Management agreement, dated 14 September 2018. An administration fee equal to 0.25% of the
Company’s NAV replaces the previously charged £37,500 per annum.
Year ended
28 February 2022
Year ended
28 February 2021
A
Shares
B
Shares
Venture
Shares
Total
A
Shares
B
Shares
Venture
Shares
Total
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Investment Management Fees
99
–
439
538
107
29
200
336
Performance Fees
127
–
939
1,066
–
–
–
–
TPIM agreed not to charge their management fees for the A S
hare class for the financial year ending 28 February 2018, to build up distributable
reserves improving the ability of the Share C
lass to make dividend payments. The amount waived during the 2018 financial year was £206,400.
Subject to performance of the A Share Class and in the event of a successful disposal of A Share Assets, these fees may be recovered by TPIM.
Based on the present valuations of the A Share Class assets, the Board deem it unlikely that the fees waived to date by TPIM will become
recoverable.
The Board believe that it is unlikely the above previously uncharged fees will become payable to the Investment Manager, although this remains a
possibility the Board do not deem this probable.
TPIM agreed not to charge their management fees from 1 January 2017 on the amounts invested in gas power projects, which represents circa 75%
of the B Share Class NAV, until these investments started to generate income.
These fees continue not to be accrued.
The total fee waived to date for the B Share Class is £745,300.
Subject to performance of the B Share Class and in the event of a successful disposal of B Share Assets, these fees may be recovered by TPIM.
Based on the present valuations of the B Share Class assets, the Board deem it unlikely that the fees waived to date by TPIM will become
recoverable.
The Board believe that it is unlikely the above previously uncharged fees will become payable to the Investment Manager, although this remains a
possibility the Board do not deem this probable.
Fees paid to the Investment Manager for administrative and other services during the year was £80,000 (2021: £50,000).
The Investment Manager also received fees of £nil (2021: £nil) for services provided to investee companies.
90 |
Triple Point VCT 2011 plc
FINANCIALS
Notes to the Financial Statements
6. Operating Expenses
All expenses are accounted for on an accruals basis.
Expenses are charged wholly to revenue, apart from management fees which are charged 25% to capital and 75% to revenue, any performance fees
incurred are charged wholly to capital. From 1 March 2022, the investment management fee will be charged 10% to the revenue account and 90%
to the capital account recognising the significant increase to the Venture investments and the expected nature of returns from them.
Transaction
costs incurred when selling assets are written off to the Income Statement in the period that they occur.
Operating expenses
Year ended
28 February 2022
Year ended
28 February 2021
Revenue
Capital
Total
Revenue
Capital
Total
£’000
£’000
£’000
£’000
£’000
£’000
Financial and regulation costs
68
–
68
35
–
35
General administration
111
–
111
72
–
72
Fees payable to the Company’s auditor for audit services
30
–
30
28
–
28
Fees payable to the Company’s auditor for audit-related assurance services
21
–
21
12
–
12
Company secretarial services
18
–
18
18
–
18
Other professional fees
466
–
466
83
–
83
Directors’ fees
60
–
60
58
–
58
Financing costs
–
–
–
–
–
–
Interest write-off
–
–
–
–
–
–
Foreign exchange losses/(gains)
–
(94)
(94)
56
–
56
774
(94)
680
362
–
362
The ongoing charges ratio for the Company for the year to 28 February 2022 was 2.94% (2021: 3.03%). Total annual running costs are capped at
3.5% of the Company’s net assets. The ratio is calculated by dividing annualised ongoing charges by the average undiluted net asset value in the
period.
The annualised ongoing charges represented the total expense for the year with the adjustment of adding back the arrangement fees amounted to
£198,000 paid to Triple Point Venture Network and any management fee and performance fees payable by Triple Point Investment Management
LLP..
Any excess will be met by Triple Point by way of a reduction in future management fees.
VAT has been removed from the Audit fees and allocated to General Administration expenses.
7. Auditor Remuneration
Legal and professional fees include remuneration paid to the Company’s auditor, BDO LLP as shown in the following table:
Year ended
28 February 2022
Year ended
28 February 2021
A
Shares
B
Shares
Venture
Shares
Total
A
Shares
B
Shares
Venture
Shares
Total
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Fees payable to the Company’s auditor:
for the audit of the Financial Statements
4
4
22
30
7
8
13
28
other services
3
3
15
21
–
4
8
12
7
7
37
51
7
12
21
40
During the year, BDO LLP were appointed to perform certain agreed-upon procedures with regards to the Net Asset Value of the Venture Fund as at
31 January 2022, as part of the Board’s consideration of the appropriateness of the issue price for the most recent Venture Fund allotment.
Disclosure by share class is unaudited.
Triple Point VCT 2011 plc
| 91
FINANCIALS
Notes to the Financial Statements
8. Directors’ Remuneration
Year ended
28 February 2022
Year ended
28 February 2021
A
Shares
B
Shares
Venture
Shares
Total
A
Shares
B
Shares
Venture
Shares
Total
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Jane Owen
4
3
16
23
6
6
10
22
Chad Murrin
3
3
12
18
4
6
8
18
Tim Clarke
3
3
12
18
4
6
8
18
Julian Bartlett
–
–
1
1
–
–
–
–
10
9
41
60
14
18
26
58
The only remuneration received by the Directors was their Directors’ fees. The Company has no employees other than the Non-Executive Directors.
The average number of Non-Executive Directors in the year was three. Full disclosure of Directors’ remuneration is included in the Directors’
Remuneration report.
9. Taxation
Year ended
28 February 2022
Year ended
28 February 2021
A
Shares
B
Shares
Venture
Shares
Total
A
Shares
B
Shares
Venture
Shares
Total
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Profit/(loss) on ordinary activities before tax
(269)
5
5,240
4,976
172
(2,772)
(209)
(2,809)
Corporation tax @ 19%
(51)
1
995
945
33
(527)
(40)
(534)
Effect of:
Utilisation of tax losses brought forward
–
–
–
–
–
–
–
–
Capital gains/(losses)
not taxable
30
(
17
)
(1,348)
(1,335)
–
504
(32)
472
Dividends received not taxable
–
–
–
–
–
–
–
–
Disallowed expenditure
–
–
38
38
-
-
5
5
Unrelieved tax losses arising in the year
–
–
1
1
–
–
–
–
Excess management expense on which deferred tax not
recognised
21
–
314
335
–
–
–
–
Derecognition of prior periods deferred tax asset
–
–
89
89
–
–
–
–
Tax charge/(credit) for the period
–
(16)
89
73
33
(23)
(67)
(57)
Capital gains and losses are exempt from corporation tax due to the Company’s status as a Venture Capital Trust. Deferred tax asset of £318,462
(2021: £nil) has not been recognised in the year and a
a £89,675 write down of deferred tax asset from prior period has been made as there is no
probable future taxable profit for which the unused tax credit can be utilised.
We note the UK’s main rate of corporation tax will increase from 19% to 25% with effect from 1 April 2023.
10. Earnings per Share
The earnings per A Share is 2.71p (2021: 1.40p) and is based on a loss from ordinary activities after tax of £269,000(2021: £139,000) and on the
weighted average number of A Shares in issue during the period of 9,831,106 (2021: 9,951,133).
The loss per B Share is 0.31p (2021: (40.41p)) and is based on a profit from ordinary activities after tax of £21,000(2021: loss £2,749,000 and on the
weighted average number of B Shares in issue during the period of 6,773,208 (2021: 6,818,891).
The profit per Venture Share is 22.57p (2021: (1.16p)) and is based on a profit from ordinary activities after tax of £5,151,000 (2021: loss (142,000)
and on the weighted average number of Venture Shares in issue during the period of 22,816,854 (2021: 12,442,444).
Both basic and diluted earnings per share are the same.
92 |
Triple Point VCT 2011 plc
FINANCIALS
Notes to the Financial Statements
11.
Financial Assets at Fair Value through
Profit or Loss
Investments
Fair Value Hierarchy:
IFRS 13 requires disclosure of fair value measurement by level. The
level of fair value hierarchy within the financial assets or financial
liabilities is determined on the basis of the lowest level input that is
significant to the fair value measurement.
Financial assets and financial liabilities are classified in their entirety
into only one of the following 3 levels:
Level 1:
quoted prices on active markets for identical assets or
liabilities. The fair value of financial instruments traded on active
markets is based on quoted market prices at the balance sheet date.
A market is regarded as active where the market in which transactions
for the asset or liability takes place with sufficient frequency and
volume to provide pricing information on an ongoing basis. The
quoted market price used for financial assets held by the Company is
the current bid price.
Level 2:
the fair value of financial instruments that are not traded on
active markets is determined by using valuation techniques. These
valuation techniques maximise the use of observable inputs including
market data where it is available either directly or indirectly and rely as
little as possible on entity specific estimates. If all significant inputs
required to fair value an instrument are observable, the instrument is
included in level 2.
Level 3:
the fair value of financial instruments that are not traded on
an active market (for example, investments in unquoted companies) is
determined by using valuation techniques such as discounted cash
flows. If one or more of the significant inputs is based on
unobservable inputs including market data, the instrument is included
in level 3.
There have been no transfers between these classifications in the
period.
Any change in fair value is recognised through the Statement
of Comprehensive Income.
The portfolio of the Company is classified as level 3 and further
details of the types of investments are provided in the Investment
Manager’s Review and Investment Portfolio on pages 30 to 50.
The Company’s Investment Manager performs valuations of financial
items for financial reporting purposes, including level 3 fair values.
Valuation techniques are selected based on the characteristics of each
instrument, with the overall objective of maximising the use of
market-based information. The International Private Equity & Venture
Capital Valuation Guidelines (IPEV guidelines) provide a framework to
support our valuations techniques. Please refer to the Strategic report
on page 17 for further detail.
Level 3 valuations include assumptions based on non-observable data
with the majority of investments being valued on discounted cash
flows or price of recent transactions.
Valuation techniques and unobservable inputs:
Sector
Valuation Techniques
Significant unobservable inputs
Inter relationship between
significant unobservable
inputs and fair value
measurement
Estimated fair value would
increase/(decrease) if:
Hydroelectric Power
•
Discounted cash flows: The
valuation model considers the
present value of expected
payment, discounted using a
risk-adjusted discount rate..
•
Discount rate 6.75% (2021: 6.75%)
•
Inflation rate: 2.75% long term.(2021:
OBR 5-year forecast, 2.75% long term.)
•
The discount rate was
lower/(higher)
•
The inflation rate was
higher/(lower)
Gas Power
•
Discounted cash flows: The
valuation model considers the
present value of expected
payment, discounted using a
risk-adjusted discount rate.
•
Green Peak Generation Limited -
Discount rate 12.10% (2021: 14.90%)
•
Distributed Generators Limited -
Discount rate 10.40% (2021: 12.80%)
•
Inflation rate: 2.00% long term.(2021:
OBR 5-year forecast, 2.75% long term.)
•
The discount rate was
lower/(higher)
•
The inflation rate was
higher/(lower)
For the Venture portfolio, the Directors do not consider there to be
reasonable alternative input assumptions that would have a material
impact on the valuations at 28 February 2022.
The Board considers the discount rates used reflect the current levels
of risk and life expectancy of the investments and to be in line with
Market expectations. However, consideration has been given as to
whether the effect of changing one or more inputs to reasonably
possible alternative assumptions would result in a significant change
to the fair value measurement. Each unquoted portfolio company has
been reviewed in order to identify the sensitivity of the valuation
methodology to using alternative assumptions.
Triple Point VCT 2011 plc
| 93
FINANCIALS
Notes to the Financial Statements
On this basis, where discount rates have been applied to the unquoted investments, alternative discount rates have been considered as well as an
upside case and a downside case.
The two alternative scenarios for each investment have been modelled with the resulting movements as follows:
For the upside case relating to the A Share Class, a reduction in discount rates of 0.5% would result in
£6,806 (2021: £93,000) or 1.3% increase in
value. Applying the downside alternative of 0.5%, would result in £6,658 (2021: £124,000) or 1.2% reduction.
For the upside case relating to the B Share Class, the assumptions were flexed 2% and for the downside scenarios the assumptions were flexed by
1% representing the conservative discount rates applied. Using the upside alternative, the aggregate value of the unquoted investments would be
an increase of £540,000 (2021: £688,000) or 18%. Applying the downside alternative, the aggregate change in value of the unquoted investments
would be a reduction in the value of the portfolio of £230,000 (2021: £285,000) or 8%.
Movements in level 3 investments held at fair value through the profit or loss during the year to 28 February 2022 were as follows:
Year ended
28 February 2022
Year ended
28 February 2021
A
Shares
B
Shares
Venture
Shares
Total
A
Shares
B
Shares
Venture
Shares
Total
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Opening Cost
4,073
6,105
8,797
18,975
4,623
6,105
5,017
15,745
Opening unrealised gains
815
(2,131)
178
(1,138)
815
520
68
1,403
Opening fair value at 1 March 2021
4,888
3,974
8,975
17,837
5,438
6,625
5,085
17,148
Purchases at cost
–
–
8,988
8,988
–
–
3,780
3,780
Disposal proceeds
(3,962)
–
–
(3,962)
(550)
–
–
(550)
Transfers between share classes
–
–
–
–
–
–
–
–
Realised loss on disposal
(334)
–
–
(334)
–
–
–
–
Investment holding (losses)/gains
174
91
7,094
7,359
–
(2,651)
166
(2,485)
Foreign Exchange gain/(loss)
–
–
94
94
–
–
(56)
(56)
Closing fair value at 28 February 2022
766
4,065
25,151
29,982
4,888
3,974
8,975
17,837
Closing cost
860
6,105
17,785
24,750
4,073
6,105
8,797
18,975
Closing investment holding gains
(94)
(2,040)
7,366
5,232
815
(2,131)
178
(1,138)
All investments are designated as fair value through profit or loss at the time of acquisition and all capital gains or losses arising on investments are
so designated. Given the nature of the Company’s venture capital investments, the changes in fair values of such investments recognised in these
Financial Statements are not considered to be readily convertible to cash in full at the balance sheet date and accordingly any gains or losses on
these items are treated as unrealised.
Further details of the types of investments are provided in the Investment Manager’s review and investment portfolio on pages 30 to 41 and 44 to
45
, and details of entities over which the VCT has significant influence are included on page
s 44 to 45.
94 |
Triple Point VCT 2011 plc
FINANCIALS
Notes to the Financial Statements
12. Unconsolidated, associates and joint ventures
The principal undertakings in which the Company’s interest at the year-end is 20% or more are as follows:
Name
Registered address
Holding
Broadpoint 2 Limited
1 King William Street, London, EC4N 7AF
49.00%
Distributed Generators Limited
1 King William Street, London, EC4N 7AF
45.00%
Funding Path Limited
1 King William Street, London, EC4N 7AF
49.00%
Green Highland Shenval Limited
Q Court, 3 Quality Street, Edinburgh, EH4 5BP
22.09%
Green Peak Generation Limited
Q Court, 3 Quality Street, Edinburgh, EH4 5BP
41.67%
•
The investments are a combination of debt and equity.
•
Equity holding is equal to the voting rights.
•
All investments are held in the UK.
13. Receivables
28 February 2022
28 February 2021
A
Shares
B
Shares
Venture
Shares
Total
A
Shares
B
Shares
Venture
Shares
Total
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Accrued income
18
–
4
22
53
–
4
57
Prepaid expenses
3
3
18
24
4
5
8
17
Other debtors*
207
–
23
230
359
–
12
371
228
3
45
276
416
5
24
445
*Other debtors relate to interest receivable on investment loans.
14. Cash and Cash Equivalents
Cash and cash equivalents comprise deposits with The Royal Bank of Scotland plc with a rating of A-2 (short term) and BBB (long term) and Cater
Allen Private Bank with a rating of A-1.
15. Payables and Accrued Expenses
28 February 2022
28 February 2021
A
Shares
B
Shares
Venture
Shares
Total
A
Shares
B
Shares
Venture
Shares
Total
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Trade Creditors
65
174
18
257
63
167
165
395
Other taxation and social security
2
1
10
13
2
2
4
8
Accrued expenses & deferred income
7
6
982
995
12
16
28
56
74
181
1,010
1,265
77
185
197
459
Triple Point VCT 2011 plc
| 95
FINANCIALS
Notes to the Financial Statements
16. Share Capital
Year ended 28 February 2022
A
Shares
B
Shares
Venture
Shares
Total
£’000
£’000
£’000
£’000
Ordinary shares Allotted and fully paid up
£0.01 each
£0.01 each
£0.01 each
£0.01 each
Brought forward
100
68
152
320
Shares issued
–
–
115
115
Shares repurchased
(2)
–
(3)
(5)
Carried forward
98
68
264
430
Year ended 28 February 2021
A
Shares
B
Shares
Venture
Shares
Total
£’000
£’000
£’000
£’000
Ordinary shares Allotted and fully paid up
£0.01 each
£0.01 each
£0.01 each
£0.01 each
Brought forward
100
68
67
235
Shares issued
–
–
85
85
Shares repurchased
–
–
–
(5)
Carried forward
98
68
152
320
Total number of shares
9,777,285
6,758,795
26,445,431
42,981,511
% of total capital
23%
16%
62%
100%
Each Share Class has full voting, dividend and capital distribution rights.
During the year 11,465,442 new Shares were issued at an average price of £1.07
The gross consideration received was £11.9 million (net £11.6 million).
In the year Triple Point VCT 2011 plc repurchased 252,401 Venture Shares, 173,848 A Shares and 46,556 B Shares at nominal value totalling
£472,805 representing 1.10%
17. Financial Instruments and Risk Management
The Company’s financial instruments comprise VCT qualifying investments and non-qualifying investments, cash balances and liquid resources
including debtors and creditors. The Company holds financial assets in accordance with its investment policy detailed in the Strategic Report on
pages 16 to 17.
The Investment Manager reports to the Board on a quarterly basis and provides information to the Board which allows it to monitor and manage
financial risks relating to its operations. The Company’s activities expose it to a variety of financial risks including market risk (comprising price risk,
interest rate risk and foreign currency risk), credit risk and liquidity risk.
Fixed Asset Investments (see note 11) are valued at fair value. Unquoted investments are carried at fair value as determined by the Directors in
accordance with current venture capital industry guidelines. The fair value of all other financial assets and liabilities is
approximated by their carrying
value on the balance sheet.
The Directors believe that where an investee company’s enterprise value, which is equivalent to fair value, remains unchanged since acquisition that
investment should continue to be held at cost less any loan repayments received. Where they consider the investee company’s enterprise value has
changed since acquisition, that should be reflected by the investment being held at a value measured using a discounted cash flow model or a
recent transaction price
or a recent transaction price adjusted for better or worse operating performance.
In carrying out its investment activities, the Company is exposed to various types of risk associated with the financial instruments and markets in
which it invests. The Company’s approach to managing its risks is set out below together with a description of the nature of the financial instruments
held at the balance sheet date.
The following table discloses the financial assets and liabilities of the Company in the categories defined by IFRS 9, “Financial Instruments”.
96 |
Triple Point VCT 2011 plc
FINANCIALS
Notes to the Financial Statements
Total value
Financial Assets at
amortised cost
Financial Liabilities held
at amortised cost
Fair value through
profit or loss
£’000
£’000
£’000
£’000
Year ended 28 February 2022
Assets:
Financial assets at fair value through profit or loss
29,982
–
–
29,982
Receivables
252
252
–
–
Cash and cash equivalents
6,247
6,247
–
–
36,481
6,499
–
29,982
Liabilities:
Other Payables
1,278
–
1,265
–
1,278
–
1,265
–
Year ended 28 February 2021
Assets:
Financial assets at fair value through profit or loss
17,836
–
–
17,836
Receivables
428
428
–
–
Cash and cash equivalents
5,451
5,451
–
–
23,715
5,879
–
17,836
Liabilities:
Other Payables
459
–
459
–
459
–
459
–
Market Risk
Price Risk
The Company’s VCT qualifying investments are held in small and medium-sized unquoted investments which, by their nature, entail a higher level of
risk and lower liquidity than investments in large quoted companies. The Directors and Investment Manager aim to limit the risk attached to the
portfolio as a whole by careful selection and timely realisation of investments, by carrying out rigorous due diligence procedures and by maintaining
a spread of holdings in terms of industry sector and geographical location.
The Board reviews the investment portfolio with the Investment Manager on a regular basis. Details of the Company’s investment portfolio at the
balance sheet date are set out on pages 44 to 45. Please refer to note 11 for sensitivity analysis performed.
Interest Rate Risk
Some of the Company’s financial assets are interest bearing, of which some are at fixed rates and some at variable rates. As a result, the Company is
exposed to interest rate risk arising from fluctuations in the prevailing levels of market interest rates.
Investments made into qualifying holdings are part equity and part loan. The loan element of investments totals £1,788,000 (2021: £2,730,900) and
is subject to fixed interest rates of between 21.6% and 29.5% for between 5
–
20 years and, as a result, there is no cash flow interest rate risk. As the
loans are held in conjunction with equity and are valued in combination as part of the enterprise value, fair value risk is considered part of market
risk.
The Company also has non-qualifying loan investments of £1,176,500 (2021: £1,726,500) which carry interest rates between 7.75% and 13.5% for
between 5 – 15 years.
Triple Point VCT 2011 plc
| 97
FINANCIALS
Notes to the Financial Statements
The amounts held in variable rate investments at the balance sheet
date are as follows:
28 February 2022
28 February 2021
£’000
£’000
Cash on Deposit
6,247
5,451
6,247
5,451
An increase in interest rates of 1% per annum would not have a
material effect either on the revenue for the year or the net asset
value at 28 February 2022. The Board believes that in the current
economic climate a movement of 1% is reasonably possible.
Foreign Currency Risk
Foreign currency risk is defined as the risk that the fair values of future
cash flows will fluctuate because of changes in foreign exchange
rates. With the exception of Adfenix AB whose investment is
denominated in Swedish Kroner (“SEK”) and Digital Therapeutics Inc
(t/a Quit Genius) and Degreed Inc of which are denominated in US
dollars (“USD”), the Company’s financial assets and liabilities are
denominated in GBP and with the exception of the above
substantially all of its revenues and expenses are in GBP.
The Company does not consider the investments in Adfenix AB,
Digital Therapeutics Inc (t/a Quit Genius) and Degreed Inc to
materially expose the Company to foreign currency risk.
Credit Risk
Credit risk is the risk that a counterparty will fail to discharge an
obligation or commitment that it has entered into with the Company.
The Investment Manager and the Board carry out a regular review of
counterparty risk. The carrying value of the financial assets represent
the maximum credit risk exposure at the balance sheet date.
28 February 2022
28 February 2021
£’000
£’000
Non-Qualifying investment loans
1,501
1,177
Qualifying investment loans
1,788
2,731
Cash on Deposit
6,247
5,451
Receivables*
252
428
9,788
9,787
* Receivables do not include prepayments.
The Company’s bank accounts are maintained with The Royal Bank of
Scotland plc (“RBS”) and Cater Allen Private Bank. Should the credit
quality or financial position of RBS or Cater Allen deteriorate
significantly, the Investment Manager will move the cash holdings to
another bank.
Credit risk arising on unquoted loan stock held within unlisted
investments is considered to be part of Market risk as disclosed
above.
Liquidity Risk
The Company’s financial assets include investments in unquoted
equity securities which are not traded on a recognised stock
exchange and which are illiquid. As a result, the Company may not be
able to realise some of its investments in these instruments quickly at
an amount close to their fair value in order to meet its liquidity
requirements.
The Company’s liquidity risk is managed on a continuing basis by the
Investment Manager in accordance with policies and procedures laid
down by the Board. The Company’s overall liquidity risks are
monitored by the Board on a quarterly basis.
The Board maintains a liquidity management policy where cash and
future cash flows from operating activities will be sufficient to pay
expenses. At 28 February 2022 cash held by the Company amounted
to £6.25 million.
18. Net Asset Value per Share
The net asset value per share for the A Shares is 13.25p (2021:
52.43p) and is calculated based on net assets of £1,291,000 (2021:
£5,217,000) divided by the 9,777,285 A Shares in issue.
The net asset value per share for the B Shares is 57.69p (2021:
57.36p) and is calculated on net assets of £3,903,000 (2021:
£3,907,000)) divided by the 6,758,795 B Shares in issue.
The net asset value per share for the Venture Shares is 113.55p (2021:
93.26p) and is calculated based on net assets of £30,031,000 (2021:
£14,208,000) divided by the 26,445,431 Venture Shares in issue.
19. Commitments and Contingencies
As highlighted in note 5, the Investment Manager has waived total
management fees of £745,300 (2021: £635,650) for the B Share Class
and £206,400 (2021: £206,400) for the A Share Class.
Subject to the performance of the underlying investments and
proceeds received on any future disposals, the Investment Manager
may decide to charge these previously waived fees to the Company.
The likelihood of these outstanding fees being recovered is currently
considered possible not probable and therefore no provision has
been made.
98 |
Triple Point VCT 2011 plc
FINANCIALS
Notes to the Financial Statements
20. Relationship with Investment Manager
During the period, TPIM received £538,265 (2021: £336,355) (which
has been expensed by the Company) for providing management and
administrative services to the Company.
The Investment Manager also charged £15,000 (2021: £15,000) for
the provision of Company Secretarial services.
At the Balance Sheet date, the total fees which have been waived by
the Investment Manager stood at £745,300 (2021: £635,650).
During the period, TPIM received £127,105 (2021: £nil) in relation to
performance-related incentive fees from the A Share Class.
Furthermore, there is £953,000 accrued Venture performance fee
which will be paid to TPIM once the accounts have been audited.
During the period, TPIM received £198,000 (2021: nil) of arrangement
fees on Venture investments. In the previous year, the VCT board
approved the deferral of fees until the NAV had reached a 100p
threshold in order to avoid the erosion of NAV and given various
investments had been provided for in light of Covid-19.
In addition, TPIM received £200,000 (2021: £19,500) of arrangement
fees on Venture share allotments during the year.
21. Ultimate controlling party
In the opinion of the Board, on the basis of the shareholdings advised
to them, the Company has no ultimate controlling party.
22. Related Party Transactions
The Directors Remuneration Report on page 65 discloses the
Directors’ remuneration and shareholdings.
During the year, the Company completed the sale of a substantial
part of its hydroelectric power assets within the A Ordinary Share
Class for total consideration of £4,245,725, and a substantial part of
the hydroelectric power portfolio indirectly held through its interest in
Broadpoint 3 Limited within the B Ordinary Share Class for a total
consideration of £1,102,722 to Triple Point Energy Efficiency
Infrastructure Company plc (“TEEC”) of whom is also managed by
Triple Point Investment Management LLP. The transaction followed a
full conflicts process, with two separate team within the Investment
Manager dealing with the sale and purchase, The two teams were
segregated, with distinct independent reporting lines and separate
access to the electronic files relevant to the transaction.
23. Post Balance Sheet Events
The following other events occurred between the balance sheet date
and the signing of these financial statements:
•
3.0 million Venture Shares were issued on 1 March 2022 at an
allotment price of 114.46p under the Offer closing on 29 July
2022.
•
1.2 million Venture Shares were issued on 15 March 2022 at an
allotment price of on 29 July 2022.
•
4.1 million Venture Shares were issued on 1 April 2022 at
an allotment price of 116.39 pence under the Offer which closed
on 29 July 2022.
•
1.7 million Venture Shares were issued on 5 April 2022 at an
allotment price of 116.67 pence under the Offer which closed on
29 July 2022.
•
The B Share Class loan investment in Broadpoint 3 Ltd was
repaid.
•
The Venture C
lass sold their first investment, Credit Kudos,
at a
profit for total proceeds of £2.6 million. 10% of the
proceeds are
currently being held in escrow due to buyer indemnities.
•
5 new Venture share class investments completed totalling
£1.7 million.
•
1 Venture share class follow-on investment completed totalling
£0.5 million.
UNAUDITED
NON-STATUTORY
ANALYSIS
100 |
Triple Point VCT 2011 plc
NON-STATUTORY ANALYSIS
Unaudited Non-Statutory Analysis of
The A Share Fund
A CLASS
Statement of Comprehensive Income
Year ended
28 February 2022
Year ended
28 February 2021
Revenue
Capital
Total
Revenue
Capital
Total
£’000
£’000
£’000
£’000
£’000
£’000
Investment income
209
–
209
339
–
339
Realised gain/(loss) on investments
–
(334)
(334)
–
–
–
Unrealised gain/(loss) on investments
–
174
174
–
–
–
Investment return
209
(160)
49
339
–
339
Investment management fees
(74)
(25)
(99)
(92)
(27)
(107)
Other expenses
(92)
(127)
(219)
(48)
–
(60)
Profit
/(loss) before taxation
43
(312)
(269)
199
(27)
172
Taxation
–
–
–
(38)
5
(33)
Profit/(loss) after taxation
43
(312)
(269)
161
(22)
139
Profit
/(loss) and total comprehensive income
43
(312)
(269)
161
(22)
139
Basic and diluted earnings per share
0.46p
(3.17p)
(2.71p)
1.62p
(0.22p)
1.40p
Balance Sheet
28 February 2022
28 February 2021
£’000
£’000
Non-current assets
Financial assets at fair value through profit or loss
766
4,887
Current assets
Receivables
228
416
Cash and cash equivalents
433
52
661
468
Current liabilities
Payables
(74)
(77)
Corporation Tax
(62)
(62)
Net assets
1,291
5,216
Equity attributable to equity holders
1,291
5,749
Net asset value per share
13.25p
52.43p
Statement of Changes in Shareholders’ Equity
28 February 2022
28 February 2021
£’000
£’000
Opening Shareholders’ funds
5,216
5,749
Purchase of own Shares
(81)
–
Profit/(loss)
for the year
(269)
139
Dividend paid
(3,575)
(672)
Closing Shareholders’ funds
1,291
5,216
Triple Point VCT 2011 plc
| 101
NON-STATUTORY ANALYSIS
Unaudited Non-Statutory Analysis of
The A Share Fund
A CLASS
Investment Portfolio
28 February 2022
28 February 2021
Cost
Valuation
Cost
Valuation
£’000
%
£’000
%
£’000
%
£’000
%
Unquoted qualifying holdings
860
66.51
533
44.45
4,073
98.74
4,887
98.95
Non-Qualifying holdings
–
–
233
19.43
–
–
–
–
Financial assets at fair value through profit or loss
860
66.51
766
63.89
4,073
98.75
4,887
98.95
Cash and cash equivalents
433
33.49
433
36.11
52
1.25
52
1.05
1,293
100.00
1,199
100.00
4,125
100.00
4,939
100.00
Qualifying Holdings
Unquoted
Hydroelectric Power
Green Highland Allt Choire A Bhalachain (225) Ltd
–
–
–
–
30
0.73
36
0.73
Green Highland Allt Ladaidh (1148) Ltd
–
–
–
–
1,470
35.64
2,201
44.56
Green Highland Allt Luaidhe (228) Ltd
–
–
–
–
855
20.73
1,037
21.00
Green Highland Allt Phocachain (1015) Ltd
–
–
–
–
858
20.80
1,021
20.67
Green Highland Shenval Ltd
860
66.51
533
44.45
860
20.85
592
11.99
860
66.51
533
44.45
4,073
98.75
4,887
98.95
28 February 2022
28 February 2021
Cost
Valuation
Cost
Valuation
Non-Qualifying Holdings
£’000
%
£’000
%
£’000
%
£’000
%
Unquoted
SME Funding:
Hydroelectric Power
Broadpoint 3 Ltd
–
–
233
19.43
–
–
–
–
–
–
233
19.43
–
–
–
–
102 |
Triple Point VCT 2011 plc
Unaudited Non-Statutory Analysis of
The B Share Fund
B CLASS
NON-STATUTORY ANALYSIS
Statement of Comprehensive Income
Year ended
28 February 2022
Year ended
28 February 2021
Revenue
Capital
Total
Revenue
Capital
Total
£’000
£’000
£’000
£’000
£’000
£’000
Investment income
–
–
–
1
–
1
Unrealised gain/(loss) on investments
–
91
91
-
(2,651)
(2,651)
Investment return
–
–
–
1
(2,651)
(2,650)
Investment management fees
–
–
–
(22)
(7)
(29)
Other expenses
(86)
–
(86)
(93)
–
(93)
Profit/(loss)
before taxation
(86)
91
5
(114)
(2,658)
(2,772)
Taxation
16
–
16
22
1
23
Profit/(loss)
after taxation
(70)
91
21
(92)
(2,657)
(2,749)
(Loss)/profit and total comprehensive Income
(70)
91
21
(92)
(2,657)
(2,749)
Basic and diluted (loss)/earnings per share
(1.04p)
1.35p
0.31p
(1.36p)
(39.05p)
(40.41p)
Balance Sheet
28 February 2022
28 February 2021
£’000
£’000
Non-current assets
Financial assets at fair value through profit or loss
4,065
3,974
Current assets
Receivables
3
5
Corporation Tax
47
30
Cash and cash equivalents
(31)
83
19
118
Current liabilities
Payables
(181)
(185)
Net assets
3,903
3,907
Equity attributable to equity holders
3,903
3,907
Net asset value per share
57.69p
57.36p
Statement of Changes in Shareholders’ Equity
28 February 2022
28 February 2021
£’000
£’000
Opening Shareholders' funds
3,907
6,996
Share buybacks
(25)
-
Profit/(loss) for the year
21
(2,749)
Dividend paid
–
(340)
Closing Shareholders’ funds
3,903
3,907
Triple Point VCT 2011 plc
| 103
Unaudited Non-Statutory Analysis of
The B Share Fund
B CLASS
NON-STATUTORY ANALYSIS
Investment Portfolio
28 February 2022
28 February 2021
Cost
Valuation
Cost
Valuation
£’000
%
£’000
%
£’000
%
£’000
%
Unquoted qualifying holdings
5,100
83.96
2,969
73.60
5,100
82.40
2,969
73.17
Non-Qualifying holdings
1,005
16.55
1,096
27.17
1,005
16.24
1,005
24.77
Financial assets at fair value through profit or loss
6,105
100.51
4,065
100.77
6,105
98.64
3,974
97.94
Cash and cash equivalents
(31)
(0.51)
(31)
(0.77)
83
1.36
83
2.06
6,074
100.00
4,034
100.00
6,188
100.00
4,057
100.00
Qualifying Holdings
Unquoted
Gas Power
Distributed Generators Ltd
3,200
52.68
1,925
47.72
3,200
51.70
1,925
47.44
Green Peak Generation Ltd
1,900
31.28
1,044
25.88
1,900
30.70
1,044
25.73
5,100
83.96
2,969
73.60
5,100
82.40
2,969
73.17
28 February 2022
28 February 2021
Cost
Valuation
Cost
Valuation
Non-Qualifying Holdings
£’000
%
£’000
%
£’000
%
£’000
%
Unquoted
SME Funding
Other
Modern Power Generations Ltd
–
–
–
–
–
–
–
–
Hydroelectric Power
Broadpoint 3 Ltd
1,005
16.55
1,096
27.17
1,005
16.24
1,005
24.77
1,005
16.55
1,096
27.17
1,005
16.24
1,005
24.77
104 |
Triple Point VCT 2011 plc
Unaudited Non-Statutory Analysis of
The Venture Share Fund
VENTURE FUND
NON-STATUTORY ANALYSIS
Statement of Comprehensive Income
Year ended
28 February 2022
Year ended
28 February 2021
Revenue
Capital
Total
Revenue
Capital
Total
£’000
£’000
£’000
£’000
£’000
£’000
Investment income
26
–
26
34
–
34
Unrealised gain on investments
–
7,094
7,094
–
166
166
Investment return
26
7,094
7,120
34
166
200
Investment management fees
(329)
(110)
(439)
(173)
(50)
(223)
Other expenses
(596)
–
(596)
(186)
-
(186)
Performance Fee
–
(939)
(939)
–
–
–
FX revaluation gain
–
94
94
–
–
–
Profit/(loss)
before taxation
(899)
6,139
5,240
(325)
116
(209)
Taxation
(74)
(15)
(89)
57
10
67
Profit/(loss)
before taxation
(973)
6,124
5,151
(268)
126
(142)
Profit/(loss)
and total comprehensive income
(973)
6,124
5,151
(268)
126
(142)
Basic and diluted loss per share
(4.26p)
26.84p
22.57p
(2.17p)
1.01p
(1.16p)
Balance Sheet
28 February 2022
28 February 2021
£’000
£’000
Non-current assets
Financial assets at fair value through profit or loss
25,151
8,975
Current assets
Receivables
45
24
Corporation tax
–
90
Cash and cash equivalents
5,845
5,316
5,890
5,430
Current liabilities
Payables
(1,010)
(197)
Net assets
30,031
14,208
Equity attributable to equity holders
30,031
–
Net asset value per share
113.55p
93.27p
Statement of Changes in Shareholders’ Equity
28 February 2022
28 February 2021
£’000
£’000
Opening Sshareholders’ funds
14,208
6,625
Issue of new Shares
11,596
8,090
Share buyback & cancellation
(250)
–
Profit/(loss)
for the year
5,151
(142)
Dividend paid
(674)
(366)
Closing Shareholders’ funds
30,031
14,208
NON-STATUTORY
ANALYSIS
Triple Point VCT 2011 plc
| 105
Unaudited Non-Statutory Analysis of
The Venture Share Fund
VENTURE FUND
NON-STATUTORY ANALYSIS
Investment Portfolio
28 February 2022
28 February 2021
Cost
Valuation
Cost
Valuation
£’000
%
£’000
%
£’000
%
£’000
%
Unquoted qualifying holdings
17,314
73.27
24,667
79.58
8,327
58.99
8,492
59.44
Non-Qualifying holdings
471
1.99
484
1.56
470
3.33
483
3.38
Financial assets at fair value through profit or loss
17,785
75.26
25,151
81.14
8,797
62.33
8,975
62.80
Cash and cash equivalents
5,845
24.74
5,845
18.86
5,316
37.67
5,316
37.20
23,630
100.00
30,996
100.00
14,113
100.00
14,291
100.00
Qualifying Holdings
Unquoted
Venture Investments
Degreed Inc.
300
1.27
533
1.72
300
2.13
315
2.20
Augnet Ltd
300
1.27
–
–
300
2.13
150
1.05
MWS Technology Ltd
150
0.63
353
1.14
150
1.06
177
1.24
Counting Ltd (t/a Counting Up)
920
3.89
835
2.69
920
6.52
1,044
7.31
Ably Real Time Ltd
1,312
5.55
3,153
10.17
500
3.54
500
3.50
Heydoc Ltd
760
3.22
1,374
4.43
400
2.83
400
2.80
Vyne Technologies Ltd
1,127
4.77
3,725
12.02
560
3.97
894
6.26
Homelyfe Limited (t/a Aventus)
700
2.96
–
–
500
3.54
475
3.32
Digital Therapeutics Inc (t/a Quit Genius)
1,245
5.27
2,755
8.89
698
4.95
614
4.30
Adfenix AB
799
3.38
673
2.17
799
5.66
723
5.06
Credit Kudos Limited
500
2.12
2,518
8.12
500
3.54
500
3.50
Artifical Artists Ltd
150
0.63
120
0.39
150
1.06
150
1.05
Veremark Limited
450
1.90
471
1.52
150
1.06
150
1.05
Localz UK
750
3.17
750
2.42
500
3.54
500
3.50
Sealit Ltd
200
0.85
180
0.58
200
1.42
200
1.40
Bkwai Ltd
250
1.06
170
0.55
200
1.42
200
1.40
Exate Ltd
500
2.12
400
1.29
500
3.54
500
3.50
Expression Insurance Services Limited
500
2.12
681
2.20
500
3.54
500
3.50
Kamma Limited
500
2.12
250
0.81
500
3.54
500
3.50
Seedata Limited
150
0.63
150
0.48
–
–
–
–
Stepex Limited
499
2.11
499
1.61
–
–
–
–
Anorak Limited
700
2.96
525
1.69
–
–
–
–
Gameplan Technology Limited
1,000
4.23
1,000
3.23
–
–
–
–
Nook
250
1.06
250
0.81
–
–
–
–
Tickitto AI Limited
1,000
4.23
1,000
3.23
–
–
–
–
SonicJobs Ltd
450
1.90
450
1.45
–
–
–
–
Superlayer Ltd
224
0.95
224
0.72
–
–
–
–
Knok Healthcare Limited
513
2.17
513
1.66
–
–
–
–
Learnerbly Ltd
200
0.85
200
0.65
–
–
–
–
Pixie
915
3.87
915
2.95
–
–
–
–
17,314
73.27
24,667
79.58
8,327
58.99
8,492
59.44
28 February 2022
28 February 2021
Cost
Valuation
Cost
Valuation
£’000
%
£’000
%
£’000
%
£’000
%
Non-Qualifying Holdings
Unquoted
Other
Modern Power Generation Ltd
471
1.99
484
1.56
470
3.33
483
3.38
471
1.99
484
1.56
470
3.33
483
3.38
106 |
Triple Point VCT 2011 plc
INFORMATION
Shareholder Information
Board
Jane Owen (Chair)
Julian Bartlett
Tim Clarke
Chad Murrin
Company Secretary and Registered Office:
Hanway Advisory Limited
1 King William Street
London
EC4N 7AF
Registered Number
07324448
FCA Registration number
659605
Investment Manager and Administrator
Triple Point Investment Management LLP
1 King William Street
London
EC4N 7AF
Tel: 020 7201 8989
Independent Auditor
BDO LLP
55 Baker Street
London
W1U 7EU
Solicitors
Howard Kennedy LLP
No. 1 London Bridge
London
SE1 9BG
Registrars
Computershare Investor Services plc
The Pavilions
Bridgwater Road
Bristol
BS13 8AE
VCT Taxation Advisers
Philip Hare & Associates LLP
6 Snow Hill,
London,
EC1A 2AY
Bankers
The Royal Bank of Scotland plc
54 Lime Street
London
EC3M 7NQ
Adviser (Venture Investments)
Shoosmiths LLP
1 Bow Churchyard
London
EC4M 9DQ
Triple Point VCT 2011 plc
| 107
INFORMATION
Financial Calendar
Key events
Dates
Annual General Meeting
14 July 2022
Financial half year end
31 August 2022
Announcement of half-year results
19 October 2022
Financial year end
28 February 2023
Something happens when people come together.
From the connections we make spring ideas. Fresh
solutions to big problems, from how to improve global
communications and heat our homes, to how to support
businesses and drive the economy. And from solutions
like these flow opportunities to c
reate value.
We call it the Triple Point. It’s the place where
people, purpose, and pr
ofit meet. Since 2004, we’ve
been targeting this Triple Point in areas like digital
infrastructure, ener
gy efficiency and social housing,
unlocking investment opportunities that make
a difference.
Big problems create strong demand.
Strong demand drives good investments.
Good investments solve big problems.
It means that investors never have to choose between
financial
returns and social impact. You achieve one by
achieving the other.
For more information about Triple Point
please contact a member of the Team
T
riple Point VCT 2011 plc
1 King
William Street
London
EC4N 7AF
Advisor and Investor Enquiries
020 7201 8990