Quarterly Investment Update - 31 August 2020
Capital for Colleagues plc / EPIC: CFCP / Market: AQSE / Sector: Investment
1 October 2020
CAPITAL FOR COLLEAGUES PLC (‘Capital for Colleagues’ 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 31 August 2020.
Key Statistics for the quarter:
- Portfolio comprised of 16 unquoted EOBs at the end of the quarter (31 May 2020: 16)
- Net Asset Value (‘NAV’) of £7,956,650 (31 May 2020: £7,553,434)
- NAV per share increased to 51.53 pence in the quarter (31 May 2020: 48.92 pence per share)
Key Developments in the quarter:
- The Company sold its investment in portfolio company Merkko Group Limited (‘Merkko’) for consideration of £400,000, a 100% profit on the original investment. Capital for Colleagues has used £150,000 of the proceeds from the sale to subscribe for ordinary shares in Merkko, representing approximately 10% of that company’s equity capital.
Further information on the Company’s investment portfolio is set out below.
As at 31 August 2020, the Company’s portfolio of unquoted investments was valued at £8,041,291 and comprised 16 companies operating across a range of sectors, as set out below:
Industrials (value: £4,053,388; 50.40% of Portfolio)
Construction and Materials
Civils Store Limited
Ecomerchant Natural Building Materials Limited
Employee Owners Group Limited
Merkko Group Limited
TPS Investment Holdings Limited
Place 2 Place Logistics Limited
Anthesis Consulting Group Limited
Hire and Supplies Limited
Office for Public Management Limited
Flow Control Company Limited
Leisure & Travel (value: £258,000; 3.21% of Portfolio)
South Cerney Outdoor Limited
Media (value: £586,059; 7.29% of Portfolio)
The Homebuilding Centre (Holdings) Limited
Technology (value: £3,143,844; 39.10% of Portfolio)
Software & Computer Services
2C Services Limited
Bright Ascension Limited
Computer Application Services Limited
The Security Awareness Group Ltd
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 £98.0 million per annum and support approximately 855 jobs.
Total Unquoted Investments (including short term loans) as at 31 August 2020
Valuation (including capitalised costs): £8,041,291
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.
Appropriate valuation adjustments have also been made to reflect the impact of Covid-19 and the consequential effect on the UK and the world economy.
The Board continues to believe that the Company’s adherence to Employee Ownership principles will stand our investee businesses in good stead during the weeks and months ahead and leave them in good shape for the anticipated return to normal business in due course.
Capital for Colleagues continues to have sufficient cash resources to maintain its operations and to allow flexible treatment of investee companies and their obligations.
However, the Company will continue to monitor our investee companies in light of the changing situation, including considering any further impact upon the value of our portfolio of investments.
The Directors of the Company are responsible for the contents of this announcement.
For further information, please visit www.capitalforcolleagues.com or contact:
CAPITAL FOR COLLEAGUES PLC
Richard Bailey, Chairman
Alistair Currie, Chief Executive
01985 201 980
PETERHOUSE CAPITAL LIMITED
020 7469 0930
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
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.