British Smaller VCTs have mixed performances but "promising" future

(Alliance News) - British Smaller Cos VCT PLC and British Smaller Cos VCT 2 PLC on Friday ...

Alliance News 24 November, 2023 | 2:01PM
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(Alliance News) - British Smaller Cos VCT PLC and British Smaller Cos VCT 2 PLC on Friday reported good progress in their latest half year and quarter respectively, despite a challenging macroeconomic climate.

The companies are both Leeds, England-based venture capital trusts.

British Smaller VCT said its net asset value at September 30 was 82.4 pence per share, down from 83.7p at March 31. VCT2 said its NAV was 58.40p per share at September 30, up from 57.95p at June 30.

British Smaller VCT delivered an NAV total return of positive 0.8% for the six months that ended on September 30, while the FTSE Small Cap delivered negative 0.4% over the same period.

British Smaller VCT previously in late October had declared a second interim dividend of 2.0p per share.

"The performance in the period reflects the company's positive progress despite ongoing macroeconomic challenges and geopolitical uncertainty," commented Chair Rupert Cook.

He added: "Underlying portfolio companies remain resilient, showing adaptability to market conditions and focusing on efficient use of capital. Revenues continue to grow, contributing to positive revaluations even with valuation multiples remaining subdued."

Going forward, Cook said British Smaller "has a promising pipeline of both new investment and exit opportunities". It also intends to continue deploying capital into its existing portfolio.

British Smaller VCT2, meanwhile, said it delivered a positive 0.8% return for the third quarter that ended on September 30, while the FTSE Small Cap delivered a positive 0.1% return.

In terms of the UK's wider macroeconomic climate, the company believes it "has stabilised somewhat" and "may well avoid a recession". However, it expects rates to remain high "for some time" and growth levels to remain weak.

"Portfolio companies have coped well in this environment, and continue to grow revenues," VCT2 said.

Looking ahead, the trust added: "It has also been pleasing to continue to achieve good realisations of portfolio companies and we feel the company's investments are well placed to deliver further exits in the coming quarters.

"We continue to see opportunities to deploy capital into promising new businesses, as well as to continue funding existing portfolio companies to help them scale up their growth plans."

Shares in British Smaller Cos VCT were up 1.3% at 77.00p each in London on Friday afternoon. Shares in VCT2 were up 3.7% at 55.50p.

By Emma Curzon, Alliance News reporter

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
British Smaller Companies VCT Ord 77.00 GBX 0.00 -
British Smaller Companies VCT2 Ord 54.50 GBX 0.00 -

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