Half Yearly Investment Update

As at 28 February 2019 download PDF

Half Yearly Investment Update 

Capital for Colleagues, the investment vehicle focused on opportunities in the Employee Owned Business (‘EOB’) sector, is pleased to announce an investment update in respect of the six months ended 28 February 2019. 

 

Key Statistics for the six months: 

  • Portfolio comprised of 17 unquoted EOBs at the end of the six months (31 August 2018: 17) 
  • Net Asset Value (‘NAV’) of GBP 7,419,833 (31 August 2018: GBP 6,816,878) 
  • NAV per share increased by more than 8.8% to 48.05 pence (31 August 2018: 44.15 pence per share) 

 

Material developments in the six months:  

  • A further loan of GBP 150,000 was made to TG Engineering Limited (‘TGE’), to provide it with additional working capital. TGE operates from a 20,000 sq. ft factory in Ferndown, near Poole in Dorset, where it manufactures precision machined, extremely high tolerance, steel and aluminium components for use in the aerospace and scientific industries. Capital for Colleagues currently has a 35% equity interest in TGE and outstanding loans of GBP 775,000 to that company 
Commenting on the investment update, John Eckersley, Chief Executive of the Company, said: 

“I am delighted to be able to report a robust investment performance as I pass my executive responsibilities to Alistair Currie. We have established a diverse and balanced portfolio for the Company, and I am confident that Capital for Colleagues and its shareholders will benefit as the portfolio matures and as we continue to expand our exposure to the exciting EOB sector”. 

 

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

Material Developments in the Quarter:

The Company invested GBP 600,000 in a new portfolio company, TG Engineering Limited (‘TGE’) by way of loan. TGE, which operates from a 20,000 sq. ft factory in Ferndown, near Poole in Dorset, manufactures precision machined, extremely high tolerance, steel and aluminium components for use in the aerospace and scientific industries. Further information on the Company’s investment portfolio is set out below.

 

Unquoted Investments

As at 28 February 2019, the Company’s portfolio of unquoted investments was valued at GBP 7,213,715 and comprised 17 companies operating across a range of sectors, as set out below:

 

Industrials (value: GBP, 4,782,576; 66.30% of Portfolio)

Construction and Materials
Support Services
Civils Store Limited Anthesis Consulting Group Limited
Ecomerchant Natural Building Materials Limited Cotswold Valves Limited
Employee Owners Group Limited Hire and Supplies Limited
Merkko Group Limited Office for Public Management Limited
TPS Investment Holdings Limited Flow Control Company Limited
  Castlefield Corporate Advisory Partners Limited
Industrial Transportation
Engineering
Place 2 Place Logistics Limited TG Engineering Limited

Media (value: GBP 443,619; 6.15% of Portfolio)

Exhibition Centres
The Homebuilding Centre (Holdings) Limited

Technology (value: GBP 1,987,520; 27.55% of Portfolio)

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

 

The loans and investments made by the Company to unquoted EOBs are aimed at delivering equity-like returns. Each loan or investment is tailored to the individual investee company’s operating performance and specific working capital needs.

The Directors believe that the unquoted EOBs in the Company’s portfolio currently generate total turnover of around GBP 77 million per annum and support approximately 625 jobs. 

 

Total Unquoted Investments

(including short term loans) as at 28 February 2019

Cost: GBP 5,519,626
Valuation (including capitalised costs): GBP 7,213,715

 

Basis Of Valuation 

Each of the unquoted investments is included at the Directors’ assessment of fair value, in accordance with International Private Equity and Venture Capital Guidelines. Nevertheless, as a matter of prudence, the Directors have provided for a general provision equivalent to 2 per cent. of the value of the unquoted investments for possible impairment. The Directors do not, however, believe that any general provision impairment is necessary in respect of any of the Company’s current unquoted investments.

Account is taken of any potential taxation liability in respect of the increase in value of investments on an annual basis, as at the Company’s year-end.  The Directors of the Company are responsible for the contents of this announcement. 

 

**ENDS** 

 

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

Capital For Colleagues Plc
0161 464 3260

Richard Bailey, Chairman

John Eckersley, Chief Executive

 

Peterhouse Capital Limited
020 7469 0930

Mark Anwyl

Duncan Vasey

Capital for Colleagues 

Capital for Colleagues is an investment company focused on the UK EOB sector. The Company has a proven management team, with a wide network of contacts and affiliates, as well as established access to investment opportunities, enabling the Company to execute its strategy and capitalise on EOB-focused investment opportunities. 

The Company’s joint venture, Castlefield Corporate Advisory Partners, educates and assists companies which are looking to launch employee ownership schemes, advising them, amongst other things, on how to secure investment and achieve their objectives. 

 

Market Abuse Regulation (MAR) Disclosure 

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.