Quarterly Investment Update - 21 March 2022

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

21 March 2022

CAPITAL FOR COLLEAGUES PLC

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

QUARTERLY INVESTMENT UPDATE

Capital for Colleagues, the investment vehicle focused on opportunities in the Employee Owned Business (‘EOB’) sector, announces an investment update in respect of the quarter ended 28 February 2022.

Key Statistics for the quarter:

• Portfolio comprised of 14 unquoted EOBs at the end of the quarter (30 November 2021: 14)
• Net Asset Value (‘NAV’) of £12,645,859 (30 November 2021: £10,764,556)
• Following the dividend of 1.5p per share (accrued at 28 February 2022 and paid on 3 March 2022), NAV per share decreased to 68.38 pence in the quarter (30 November 2021: 70.94 pence per share)

Key Developments in the quarter:

• The Company partially disposed of its investment in portfolio company, TPS Investment Holdings Limited (‘TPS’), for cash consideration of approximately £121,000. The Company retains an interest in the TPS ‘B’ ordinary shares, which were valued at £510,000 as at 31 August 2021.
• Capital for Colleagues raised £1.95 million (before expenses) through a placing of 3,050,337 new ordinary shares at a price of 64p per share.
• Portfolio company, Bright Ascension Limited (‘BAL’), redeemed the Company’s interest in BAL’s ‘A’ ordinary shares for cash consideration of £250,000.
• The Company agreed to sell its interest in the ‘A’ ordinary shares of The Homebuilding Centre (Holdings) Limited (‘HBC’) for minimum consideration of £250,000 over a 5-year period. The Company retains a 15% interest in HBC’s issued ordinary shares.

The Company currently has cash balances of £4.188 million. The Company has no debt.

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

UNQUOTED INVESTMENTS

As at 28 February 2022, the Company’s portfolio of unquoted investments was valued at £8,341,233 and comprised 14 companies operating across a range of sectors, as set out below:

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 £ 55.7 million (*£52.8 million) per annum and support approximately 350 (*345)  jobs. 

*On a like for like comparison with the previous quarter, excluding disposals.

Total Unquoted Investments (including short-term loans) as at 28 February 2022

Cost: £5,538,304

Valuation (including capitalised costs): £8,341,234

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.

Account is taken of any potential taxation liability in respect of the increase in value of investments on a quarterly basis.

**ENDS**

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

Capital for Colleagues

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

Market Abuse Regulation (MAR) Disclosure

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation EU 596/2014 as it forms part of retained EU law (as defined in the European Union (Withdrawal) Act 2018).