Octopus Apollo VCT Plc
Half-Yearly Results
28 September 2017
Octopus Apollo VCT plc, managed by Octopus Investments Limited, today announces the unaudited half-yearly results for the six months ended 31 July 2017.
These results were approved by the Board of Directors on 28 September 2017.
You may, in due course, view the Half-Yearly report in full at www.octopusinvestments.com. All other statutory information can also be found there.
Financial Headlines
| Six months to 31 July 2017 | Six months to 31 July 2016 | Year to 31 January 2017 | |
| Net assets (£'000s) | 155,341 | 152,139 | 141,799 |
| Return on ordinary activities after tax (£'000s) | 1,799 | 1,309 | 5,172 |
| Net asset value ('NAV')* | 62.2p | 83.0p | 63.2p |
| Cumulative dividends paid since launch (p per share)* | 55.7p | 32.5p | 54.0p |
| Total return* | 117.9p | 115.5p | 117.2p |
| Ordinary dividend declared in respect of period | 1.6p | 2.5p | 1.7p |
| Special dividend declared | - | 16.5p | - |
*Comparative figures are for the Ordinary Share class only.
The interim dividend will be paid on 15 December 2017 to Shareholders on the register on 24 November 2017, and will be eligible for the Dividend Reinvestment Scheme (DRIS).
Chairman's Statement
I am pleased to present the half-yearly report of Octopus Apollo VCT for the six months ended 31 July 2017.
The NAV total return including the 1.7p dividend paid in the period, increased by 1.1% during the six months although the NAV decreased by 1.0p per share. In keeping with the regular dividend policy, your Board has declared an interim dividend of 1.6p which will be paid to shareholders in December.
During the period the portfolio performed broadly in line with expectations with a small number of exceptions and there were five exits as explained in further detail below.
There were follow-on funding rounds into seven existing investments and the team currently has a strong pipeline of new investment opportunities so I remain cautiously optimistic about the outlook, despite the political and economic uncertainty resulting from Brexit negotiations.
Murray Steele
Chairman
28 September 2017
Interim Management Report
Overview
We are approaching the investment environment with caution at present given the political and economic uncertainty relating to Europe. The portfolio is not materially exposed to Europe so the most obvious risk appears to be that a UK recession could result. However the investments are generally structured with a higher component of lending than equity which provides an element of downside protection.
Performance
In the six months under review the NAV Total Return, after adding back the 1.7p of dividends paid in the period, has increased 1.1% although the Net Asset Value has decreased 1.6% to 62.2p per share, compared to 63.2p per share at 31 January 2017. This generally positive performance is attributable to a number of successful exits which will be discussed later in this statement, as well as a continuation of the strong interest yield from loans made to portfolio companies.
Portfolio Activity
The most significant drivers of change in value are the disposals described in more detail below. Within the remaining portfolio the most positive developments were in Eve Sleep, valued up by £0.6 million during the period, based on the share price at the point of listing on the Alternative Investment Market in April, and Swoon Editions (up £0.5 million) as it continues to grow faster than forecasted. Unfortunately the investment in Spiralite was written down to zero (from £1.4 million) as a result of entering administration in July. The rest of the portfolio continues to perform broadly in line with expectations.
During the six months to 31 July 2017, the Company made the following disposals:
| Initial Cost (£) | Sale Proceeds (£) | Gain/(Loss) on Sale (£) | |
| Clifford Thames Group Limited | 13,318,000 | 24,014,000 | 10,696,000 |
| Aquaso Limited | 3,500,000 | 3,907,000 | 407,000 |
| The History Press | 754,000 | 857,000 | 103,000 |
| Haravar Limited | 5,000,000 | 4,987,000 | (13,000) |
| Galvara Limited | 5,000,000 | 4,987,000 | (13,000) |
| 27,572,000 | 38,752,000 | 11,180,000 |
Clifford Thames was acquired by OEConnection LLC in June 2017, a US company specialising in automotive technology for vehicle manufacturers. This generated a strong return to Apollo of 1.8x cash invested over the three year period since Lloyds Development Capital acquired the company in August 2014 and Apollo reinvested £14.4 million. The return includes the interest income on the loan and the uplift in value of the shares.
In May 2017 Aquaso was sold to Eddyfi Technologies, a Canadian oil and gas technology business. Aquaso is the holding company of Technical Software Consultants ("TSC"), an oil and gas technology, services and manufacturing business. Apollo originally invested £3 million in 2012 and provided a further £0.5 million in January 2016 when the market conditions were extremely challenging. The sale provided a return of 1.4x total cash invested, including interest income earned on the loan. There was also an earn-out which successfully concluded after 31 July, taking total returns to 1.5x.
The disposals of Galvara and Haravar related to acquisition vehicles which had been established to acquire or develop a VCT qualifying trade, but for which the opportunities being pursued did not materialise. The boards of those companies consequently elected to liquidate them and return funds to Apollo. The History Press was acquired as part of the Eclipse portfolio and has now been sold.
Following the sale of SCM World to Gartner Inc in June 2016, an earn out was successfully achieved resulting in a further £0.3 million of proceeds in March 2017.
During the period £1.3 million was invested to provide follow-on funding rounds to seven existing portfolio companies. The largest of these was £0.7 million invested in Oxifree, an oil and gas services business acquired as part of the Eclipse portfolio.
Transactions with Manager
Details of amounts paid to the Manager are disclosed in note 7 to the Financial Statements.
Share Buybacks
Your Company has continued to buy back shares. In the six months to July 2017, the Company bought back 1,263,370 shares for total consideration of £754,000.
Share Issues and Fundraising
An Offer for Subscription was launched in November 2016 to raise up to £20 million, and closed fully subscribed in March 2017, eight months ahead of schedule. After expenses, £16 million pounds was raised under the offer in the period under review. In total, the offer raised £20.5 million net of expenses.
Dividend and Dividend Policy
It is your Board's policy to maintain a regular dividend flow where possible in order to take advantage of the tax free distributions a VCT is able to provide.
Your Board has declared an interim dividend of 1.6p per share in respect of the period ended 31 July 2017. The dividend will be payable on 15 December 2017 to shareholders on the register at 24 November 2017.
VCT Qualifying Status
PricewaterhouseCoopers LLP provides the Board and Investment Manager with advice concerning ongoing compliance with Her Majesty's Revenue & Customs ('HMRC') rules and regulations concerning VCTs. The Board has been advised that the Company is in compliance with the conditions set by HMRC for maintaining approval as a VCT.
A key requirement is to ensure that at least 70% of the assets of the fund are in VCT qualifying investments. As at 31 July 2017, 78% of the portfolio, as measured by HMRC rules, was invested in VCT qualifying investments.
Principal Risks and Uncertainties
The principal risks and uncertainties are set out in note 6 to the half yearly report and accounts.
Summary and Future Prospects
The political and economic environments remain uncertain as a result of exit negotiations with the European Union. However the portfolio has generally continued to perform well and the focus on investing a substantial part of the capital in the form of loans further reduces volatility. The recent weakening of the British Pound has not had a significant impact on the businesses we have backed as they are generally UK based and do not have large unhedged foreign currency exposures. As such, the returns to shareholders have shown low volatility year on year, which is testament to the prudent investment approach adopted by the Investment Manager. The investment team has an active pipeline of new investment opportunities and we believe we can continue to find suitable VCT qualifying investments.
Octopus Investments Limited
28 September 2017
Investment Portfolio
| Sector | Investment cost as at 31 July 2017 (£'000) | Movement in fair value to 31 July 2017 (£'000) | Fair value as at 31 July 2017 (£'000) | Movement in fair value in period (£'000) | % equity held by Apollo VCT | % equity held by all funds managed by Octopus | |
| Fixed asset investments | |||||||
| Vista Retail Support Limited | Business Services | 6,758 | 2,639 | 9,397 | (160) | 12.0 | 12.0 |
| Healthcare and Services Technology Limited | Healthcare & Education | 7,186 | 328 | 7,514 | (403) | 10.0 | 10.0 |
| Anglo European Group Limited | Manufacturing & Engineering | 5,000 | (168) | 4,832 | 40 | 26.7 | 26.7 |
| Coupra Limited | Business Services | 5,000 | (189) | 4,811 | (494) | 9.8 | 9.8 |
| Dyscova Limited | Healthcare & Education | 4,700 | - | 4,700 | - | 67.7 | 67.7 |
| Countrywide Healthcare Services Limited | Healthcare & Education | 2,675 | 952 | 3,627 | 193 | 20.7 | 20.7 |
| Kabardin Limited | Energy | 2,450 | - | 2,450 | - | 49.0 | 49.0 |
| Red Poll Power Limited | Energy | 2,450 | - | 2,450 | - | 49.0 | 49.0 |
| Valloire Power Limited | Energy | 2,450 | - | 2,450 | - | 49.0 | 49.0 |
| Tanganyika Heat Limited | Energy | 4,108 | (1,858) | 2,250 | (24) | 50.0 | 50.0 |
| Other* | Various | 36,319 | (2,414) | 33,905 | (426) | ||
| Total fixed asset investments | 79,096 | (710) | 78,386 | (1,274) | |||
| Current asset investments | |||||||
| Octopus Portfolio Manager - Cash | 32,000 | 4 | 32,004 | 4 | |||
| Octopus Portfolio Manager - Cash Plus | 19,000 | 112 | 19,112 | 112 | |||
| Octopus Portfolio Manager - Defensive Capital Growth | 19,000 | 74 | 19,074 | 74 | |||
| Total current asset investments | 70,000 | 190 | 70,190 | 190 | |||
| Total fixed and current asset investments | 148,576 | ||||||
| Cash at bank | 6,067 | ||||||
| Debtors less creditors | 698 | ||||||
| Total net assets | 155,341 |
*Comprises 43 other investments: Acquire Your Business Limited, Angelico Solar Limited, Artesian Solutions Limited, Augean plc, Barrecore Limited, Behaviometrics AB, Bramante Solar Limited, British Country Inns plc, Canaletto Solar Limited, Cello Group plc, CurrencyFair Limited, Ecrebo Limited, EKF Diagnostics plc, Ergomed plc, Eve Sleep Limited, Hasgrove Limited, Leonardo Solar Limited, Luther Pendragon Limited, Mi-Pay Group plc, MIRACL Limited, Modigliano Solar Limited, Nektan plc, Origami Energy Limited, Oxifree UK Limited, Pirlo Solar Limited, Plastics Capital plc, PTB Films, Quickfire, Quickfire2, Secret Escapes Limited, Segura Systems Limited, Sourceable Limited, Superior Heat Limited, Tailsco Limited, Tanfield Group Limited, Time Out Group plc, Tintoretto Solar Limited, Tiziano Solar Limited, Trafi Limited, Vertu Motors plc, Winnipeg Heat (Caspian), Yu Group plc, Zynstra Limited.
Directors Responsibilities Statement
We confirm that to the best of our knowledge:
· the half-yearly financial statements have been prepared in accordance with the Financial Reporting Standard 104 "Interim Financial Reporting" issued by the Financial Reporting Council;
· the half-yearly report includes a fair review of the information required by the Financial Conduct Authority's Disclosure and Transparency Rules, being:
· an indication of the important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements;
· a description of the principal risks and uncertainties for the remaining six months of the year; and
· a description of related party transactions that have taken place in the first six months of the current financial year, that may have materially affected the financial position or performance of the Company during that period and any changes in the related party transactions described in the last annual report that could do so.
On behalf of the Board
Murray Steele
Chairman
28 September 2017
Income Statement
| Unaudited | Unaudited | Audited | |||||||||
| Six months to 31 July 2017 | Six months to 31 July 2016 | Year to 31 January 2017 | |||||||||
| Revenue £'000 | Capital £'000 | Total £'000 | Revenue £'000 | Capital £'000 | Total £'000 | Revenue £'000 | Capital £'000 | Total £'000 | |||
| Gain on disposal of fixed asset investments | - | 3,701 | 3,701 | - | 987 | 987 | - | 2,658 | 2,658 | ||
| Change in fair value of fixed asset investments | - | (1,274) | (1,274) | - | 367 | 367 | - | 4,525 | 4,525 | ||
| Change in fair value of current asset investments | - | 190 | 190 | - | - | - | - | - | - | ||
| Investment income | 2,061 | - | 2,061 | 2,188 | - | 2,188 | 4,128 | - | 4,128 | ||
| Investment management fees | (341) | (1,406) | (1,747) | (308) | (1,097) | (1,405) | (647) | (2,844) | (3,491) | ||
| Other expenses | (1,136) | - | (1,136) | (758) | - | (758) | (2,654) | - | (2,654) | ||
| FX translation | - | 4 | 4 | - | - | - | - | 6 | 6 | ||
| Return on ordinary activities before tax | 584 | 1,215 | 1,799 | 1,122 | 257 | 1,379 | 827 | 4,345 | 5,172 | ||
| Taxation on return on ordinary activities | - | - | - | (70) | - | (70) | - | - | - | ||
| Return on ordinary activities after tax | 584 | 1,215 | 1,799 | 1,052 | 257 | 1,309 | 827 | 4,345 | 5,172 | ||
| Earnings per share - basic and diluted | 0.2p | 0.5p | 0.7p | 0.6p | 0.2p | 0.8p | 0.5p | 2.5p | 3.0p | ||
- The 'Total' column of this statement is the profit and loss account of the Company; the supplementary revenue return and capital return columns have been prepared under guidance published by the Association of Investment Companies.
- All revenue and capital items in the above statement derive from continuing operations.
- The Company has only one class of business and derives its income from investments made in shares and securities and from bank and money market funds.
- The Company has no recognised gains or losses other than those disclosed in the income statement.
- The accompanying notes are an integral part of the half-yearly report.
Balance Sheet
| Unaudited As at 31 July 2017 | Unaudited As at 31 July 2016 | Audited As at 31 January 2017 | ||||
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
| Fixed asset investments | 78,386 | 115,435 | 112,884 | |||
| Current assets: | ||||||
| Investments | 70,190 | - | - | |||
| Debtors | 2,245 | 5,248 | 4,077 | |||
| Cash at bank | 6,067 | 35,632 | 29,229 | |||
| 78,502 | 40,880 | 33,306 | ||||
| Creditors: amounts falling due within one year | (1,547) | (4,176) | (4,391) | |||
| Net current assets | 76,955 | 36,704 | 28,915 | |||
| Net assets | 155,341 | 152,139 | 141,799 | |||
| Share capital | 25,138 | 16,745 | 22,603 | |||
| Share premium | 48,308 | 1,438 | 34,231 | |||
| Special distributable reserve | 71,149 | 128,328 | 76,144 | |||
| Capital redemption reserve | 2,958 | 2,672 | 2,832 | |||
| Capital reserve realised | 7,714 | (1,087) | (1,537) | |||
| Capital reserve unrealised | (520) | 2,988 | 7,520 | |||
| Revenue reserve | 584 | 1,055 | - | |||
| Translation reserve | 10 | - | 6 | |||
| Total equity shareholders' funds | 155,341 | 152,139 | 141,799 | |||
| Net Asset Value per share | 62.2p | 83.0p | 63.2p | |||
The statements were approved by the Directors and authorised for issue on 28 September 2017 and are signed on their behalf by:
Murray Steele
Chairman
Company Number: 05840377
Statement of Changes in Equity
| Share Capital £'000 | Share Premium £'000 | Special distributable reserves £'000 | Capital Redemption Reserve £'000 | Capital reserve realised £'000 | Capital reserve unrealised £'000 | Revenue reserve £'000 | Translation reserve £'000 | Total £'000 | |
| Six months to 31 July 2017 | |||||||||
| As at 1 February 2017 | 22,603 | 34,231 | 76,144 | 2,832 | (1,537) | 7,520 | - | 6 | 141,799 |
| Comprehensive income for the period: | |||||||||
| Management fee allocated as capital expenditure | - | - | - | - | (1,406) | - | - | - | (1,406) |
| Current period gains on disposal | - | - | - | - | 3,701 | - | - | - | 3,701 |
| Current period gains on fair value of investments | - | - | - | - | - | (1,084) | - | - | (1,084) |
| Current period currency gains | - | - | - | - | - | - | - | 4 | 4 |
| Profit on ordinary activities after tax | - | - | - | - | - | - | 584 | 584 | |
| Total comprehensive income for the period | - | - | - | - | 2,295 | (1,084) | 584 | 4 | 1,799 |
| Contributions by and distributions to owners: | |||||||||
| Repurchase and cancellation of own shares | (126) | - | (754) | 126 | - | - | - | - | (754) |
| Issue of shares | 2,661 | 14,077 | - | - | - | - | - | - | 16,738 |
| Dividends paid | - | - | (4,241) | - | - | - | - | - | (4,241) |
| Total contributions by and distributions to owners | 2,535 | 14,077 | (4,995) | 126 | - | - | - | - | 11,743 |
| Other movements: | |||||||||
| Prior period holding gains/losses now realised | - | - | - | - | 6,956 | (6,956) | - | - | - |
| Total other movements | - | - | - | - | 6,956 | (6,956) | - | - | - |
| As at 31 July 2017 | 25,138 | 48,308 | 71,149 | 2,958 | 7,714 | (520) | 584 | 10 | 155,341 |
| Six months to 31 July 2016 | |||||||||
| As at 1 February 2016 | 13,896 | 48,893 | 60,748 | 2,557 | (1,866) | 3,510 | 3 | - | 127,741 |
| Comprehensive income for the period: | |||||||||
| Management fee allocated as capital expenditure | - | - | - | - | (1,097) | - | - | - | (1,097) |
| Current period gains on disposal | - | - | - | - | 987 | - | - | - | 987 |
| Current period gains on fair value of investments | - | - | - | - | - | 367 | - | - | 367 |
| Profit on ordinary activities after tax | - | - | - | - | - | - | 1,052 | - | 1,052 |
| Total comprehensive income for the period | - | - | - | - | (110) | 367 | 1,052 | - | 1,309 |
| Contributions by and distributions to owners: | |||||||||
| Repurchase and cancellation of own shares | (115) | - | (901) | 115 | - | - | - | - | (901) |
| Issue of shares | 2,964 | 21,026 | - | - | - | - | - | - | 23,990 |
| Total contributions by and distributions to owners | 2,849 | 21,026 | (901) | 115 | - | - | - | - | 23,089 |
| Other movements: | |||||||||
| Prior period holding gains/losses now realised | - | - | - | - | 889 | (889) | - | - | - |
| Cancellation of share premium | - | (68,481) | 68,481 | - | - | - | - | - | - |
| Total other movements | - | (68,481) | 68,481 | - | 889 | (889) | - | - | - |
| As at 31 July 2016 | 16,745 | 1,438 | 128,328 | 2,672 | (1,087) | 2,988 | 1,055 | - | 152,139 |
| Year to 31 January 2017 | |||||||||
| As at 1 February 2016 | 13,896 | 48,893 | 60,748 | 2,557 | (1,866) | 3,510 | 3 | - | 127,741 |
| Comprehensive income for the year: | |||||||||
| Management fee allocated as capital expenditure | - | - | - | - | (2,844) | - | - | - | (2,844) |
| Current year gains on disposal | - | - | - | - | 2,658 | - | - | - | 2,658 |
| Current year gains on fair value of investments | - | - | - | - | - | 4,525 | - | - | 4,525 |
| Current year currency gains | - | - | - | - | - | - | - | 6 | 6 |
| Profit on ordinary activities after tax | - | - | - | - | - | - | 827 | - | 827 |
| Total comprehensive income for the year | - | - | - | - | (186) | 4,525 | 827 | 6 | 5,172 |
| Contributions by and distributions to owners: | |||||||||
| Repurchase and cancellation of own shares | (275) | - | (1,955) | 275 | - | - | - | - | (1,955) |
| Issue of shares | 5,446 | 35,706 | - | - | - | - | - | - | 41,152 |
| Dividends paid | - | - | (36,711) | - | - | - | (830) | - | (37,541) |
| Total contributions by and distributions to owners | 5,171 | 35,706 | (38,666) | 275 | - | - | (830) | - | 1,656 |
| Other movements: | |||||||||
| Prior year holding gains/losses now realised | - | - | - | - | 515 | (515) | - | - | - |
| Cancellation of Share Premium | - | (50,788) | 50,788 | - | - | - | - | - | - |
| Cancellation of Deferred Shares - C shares | (349) | - | 349 | - | - | - | - | - | - |
| Deferred shares created - D shares | 156 | - | (156) | - | - | - | - | - | - |
| Shares issued on D share conversion | 385 | - | (385) | - | - | - | - | - | - |
| Dividends paid on D share conversion | - | - | (14,418) | - | - | - | - | - | 14,418 |
| Acquisition of D share class | (191) | (17,693) | 17,884 | - | - | - | - | - | - |
| Acquisition of Octopus Eclipse VCT plc | 3,535 | 18,113 | - | - | - | - | - | - | 21,648 |
| Total other movements | 3,536 | (50,368) | 54,062 | - | 515 | (515) | - | - | 7,230 |
| As at 31 January 2017 | 22,603 | 34,231 | 76,144 | 2,832 | (1,537) | 7,520 | - | 6 | 141,799 |
Cash Flow Statement
| Unaudited Six months to 31 July 2017 £'000 | Unaudited Six months to 31 July 2016 £'000 | Audited Year to 31 January 2017 £'000 | |
| Cash flows from operating activities: | |||
| Return on ordinary activities after tax | 1,799 | 1,309 | 5,172 |
| Adjustments for: | |||
| Decrease in debtors | 1,832 | 57 | 1,228 |
| Decrease in creditors | (2,844) | (291) | (76) |
| Debtors obtained from transaction | - | - | 848 |
| Creditors obtained from transaction | - | - | (157) |
| Gain on disposal of fixed assets | (3,701) | (987) | (2,658) |
| Loss/(Gain) on valuation of fixed asset investments | 1,274 | (367) | (4,525) |
| Gain on valuation of current asset investments | (190) | - | - |
| Cash from operations | (1,830) | (209) | (168) |
| Cash flows from investing activities: | |||
| Cash acquired from transaction | - | - | 622 |
| Purchase of fixed asset investments | (1,348) | (9,000) | (9,269) |
| Purchase of current asset investments | (72,000) | - | - |
| Sale of fixed asset investments | 38,273 | 11,547 | 40,531 |
| Sale of current asset investments | 2,000 | - | - |
| Dividend paid to exiting D shareholders | - | - | (14,418) |
| Net cash flows from investing activities | (33,075) | 2,547 | 17,466 |
| Cash flows from financing activities: | |||
| Purchase of own shares | (754) | (901) | (1,955) |
| Share issues | 16,738 | 23,990 | 41,152 |
| Dividends Paid | (4,241) | - | (37,541) |
| Net cash flows from financing activities | 11,743 | 23,089 | (1,656) |
| (Decrease)/Increase in cash and cash equivalents | (23,162) | 25,357 | 18,954 |
| Opening cash and cash equivalents | 29,229 | 10,275 | 10,275 |
| Closing cash and cash equivalents | 6,067 | 35,632 | 29,229 |
| Cash and cash equivalents comprise: | |||
| Cash at Bank | 6,067 | 35,632 | 29,229 |
Notes to the Half-Yearly Report
1. Basis of preparation
The unaudited half-yearly results which cover the six months to 31 July 2017 have been prepared in accordance with the Financial Reporting Council's (FRC) Financial Reporting Standard 104 Interim Financial Reporting (March 2015) and the Statement of Recommended Practice for Investment Companies, re-issued by the Association of Investment Companies in January 2017.
2. Publication of non-statutory accounts
The unaudited half-yearly results for the six months ended 31 July 2017 do not constitute Statutory Accounts within the meaning of s.415 of the Companies Act 2006. The comparative figures for the year ended 31 January 2017 have been extracted from the audited financial statements for that year, which have been delivered to the Registrar of Companies. The independent auditor's report on those financial statements, in accordance with chapter 3 of part 16 of the Companies Act 2006, was unqualified. This half-yearly report has not been reviewed by the Company's auditor.
3. Earnings per share
The earnings per share is based on 243,295,650 shares, being the weighted average number of shares in issue during the period (31 January 2017: 169,230,581; 31 July 2016: 172,098,191 including Ordinary Shares and D Ordinary Shares).
There are no potentially dilutive capital instruments in issue and, therefore, no diluted earnings per share figures are relevant. The basic and diluted earnings per share are therefore identical.
4. Net asset value per share
| 31 July 2017 | 31 July 2016 | 31 January 2017 | |
| Net Assets (£) | 155,341,000 | 134,526,000 | 141,799,000 |
| Shares in Issue | 249,818,756 | 162,042,257 | 224,470,119 |
| Net Asset Value per share (p) | 62.2 | 83.0 | 63.2 |
5. Dividends
A final dividend, for the year ended 31 January 2017, of 1.7p per share was paid on 28 July 2017 to shareholders on the register on 30 June 2017.
The interim dividend of 1.6p per share for the six months ending 31 July 2017 will be paid on 15 December 2017, to those shareholders on the register on 24 November 2017.
6. Principal Risks and Uncertainties
The Company's assets consist of equity and fixed-rate interest investments, cash and liquid resources. Its principal risks are therefore market risk, credit risk and liquidity risk. Other risks faced by the Company include economic, loss of approval as a VCT, investment and strategic, regulatory, reputational, operational and financial risks. These risks, and the way in which they are managed, are described in more detail in the Company's Annual Report and Accounts for the year ended 31 January 2017. The Company's principal risks and uncertainties have not changed materially since the date
of that report.
7. Related Party Transactions
Octopus acts as the investment manager of the Company. Under the management agreement, Octopus receives a fee of 2.0 per cent per annum of the net assets of the Company for the investment management services.
The Company has incurred management fees of £1,494,000 during the period to 31 July 2017 (31 July 2016: £1,232,000; 31 January 2017: £2,588,000).
A performance fee of £253,000 has been incurred during the period to 31 July 2017 (31 July 2016: £173,000; 31 January 2017: £903,000).
Octopus also provides administration and company secretarial services to the Company. Octopus receives a fee of 0.3 per cent per annum of net assets of the Company for administration services and £20,000 per annum for company secretarial services.
The Company has invested £70 million into Octopus managed funds, being the Octopus Portfolio Manager funds. To ensure the Company is not double charged management fees on these products, the Company receives a reduction in the management fee as a percentage of the value of these investments.
8. Post balance sheet events
Since 31 July 2017 the Company has issued the following shares:
| Date | Number of Shares Issued | Price per share (p) |
| 8 August 2017 | 53,415 | 61.5 |
9. Other Information
A version of this statement will be made available to all shareholders. Copies are also available from the registered office of the Company at 33 Holborn, London, EC1N 2HT, and will also be available to view on the Investment Manager's website at www.octopusinvestments.com.