ProVen VCT AGM Report

I commented on the results of ProVen VCT before their AGM on my blog. I said: “Total return to shareholders was 10.3% last year, but the fund manager did even better. Of the overall profits of the company of £18.6 million, they received £7.7 million in management fees (i.e. they received 41% of the profits this year). That includes £5.6 million in performance fees. Studying the management fee (base 2.0%) and the performance fee, I find the latter particularly incomprehensible. I will therefore be attending the AGM on the 3rd July to ask some pointed questions and I would encourage other shareholders to do the same. I am likely to vote against all the directors at this company”.

I did attend the AGM on the 3rd July in London, but so far as I could tell there were only two other ordinary shareholders present. No presentations and it was a hot day in London that might have deterred some from attending. In essence picking a summer day for an AGM and not providing any special reason for them to attend is a good way to put off shareholders from doing so.

But I did meet with the Chairman, Neal Ransome, and two representatives of the fund manager before the AGM commenced to go through the performance fee figures. The performance incentive fees are based on a very complex calculation which is essentially based on the growth in net assets of the fund plus dividends paid out, i.e. on Total Return. The manager gets 20% of any excess over a hurdle rate. The hurdle rate is the higher of a 25% uplift on initial net asset value or the initial net asset value compounded by base rate plus 1% per annum. That is on top of a “base” fee of 2.0% of net assets per annum payable to fund manager Beringea.

If one is going to have a performance incentive fee, that is not an unreasonable system. But I had already told Neal that I considered all performance incentive fees should be scrapped and a simple base fee used instead (as for example Amati AIM VCT use and other VCTs used before performance fees became common). Performance fees do not improve performance because managers have a good incentive to perform to the best of their ability anyway – if they do and the fund grows they get higher fees.

One complication in the calculation of the performance fees is that they are actually calculated separately on each of seven tranches of the funds that have been raised on previous years. There is also an additional PIF performance fee related to two specific investments. In essence, the calculation is so complex that no investor in the shares of this company could ever work it out or check that it is reasonable. I hope the auditors can do so.

The reason for the exceptionally high performance fee last year was explained as being due to the very high dividends paid out, which primarily were driven by the exceptional realisations during the year. Plus some “catch-up” from previous years having passed the hurdles. VCTs cannot generally hold on to cash because the VCT rules require them to reinvest the cash quickly which can be very difficult to do so and shareholders like the tax-free dividends anyway.

Investors have done reasonably well from this VCT (comparing them with generalist VCTs reported by the AIC), but over the last 10 years the average percentage of the year end net asset value represented by overall management and administration fees is 5.5% so the manager has done very well indeed.

The AGM was a fairly trivial event with only I and one other shareholder asking any questions. I voted against the reappointment of Malcolm Moss as I don’t like fund manager representatives on boards of trusts and told the board so – he was not present in person. All the directors should be independent in trusts which he is clearly not.

I asked whether there was any difficulty with the new VCT rules which requires a focus on earlier stage companies. Response was no but there was lots of money in the market so there was lots of competition for new deals and so pricing tends to be high.

I also asked about two of the holdings that suffered large write downs. Due to reduced market multiples on retail and ecommerce companies and underperformance respectively was given as the explanation.

Another shareholders asked about a possible merger of the two ProVen VCTs but it was said there are advantages in keeping them separate – for example it enables shareholders to sell from one trust and immediately reinvest in the other when if they did that in the same trust they would lose tax reliefs.

All resolutions were passed on a show of hands vote, with no significant proxy votes against any of the resolutions except for the remuneration report (4.9% against).

Are shareholders likely to revolt over the high levels of fund management fees at this company? I doubt it, but I think the directors should tackle this issue because the fees are unreasonable. The relatively good performance of the fund manager, which may be partly from chance, tends to end up in the hands of the manager rather than the shareholders. But if the fund underperforms it’s only the shareholders that will suffer.

Roger Lawson (Twitter: https://twitter.com/RogerWLawson )

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Bonmarché Update, FCA Grilling over Woodford and Amati AIM VCT AGM

Yesterday Bonmarché (BON) conceded defeat in its opposition to a takeover bid at 11.4p. On the 17th May it had rejected the bid because it “materially undervalues Bonmarché and its prospects”. The share price of this women’s clothing retailer was over 100p a year ago but the latest trading review suggests sales are dire because of underlying weakness in the clothing market and “a lack of seasonal weather”. Auditors might have qualified the accounts due to be published soon due to doubts about it being a going concern if sales did not pick up before then. Bonmarché looks to be another victim of changing shopping habits and changing dress styles.

Is the market for traditional men’s clothes any better? Not from my recent experience of buying two formal shirts from catalogue/on-line retailer Brook Taverner. Cost was zero although I did have to pay postage. Why was the cost zero? Because they had a special offer of 60% off for returning customers, and I had collected enough “points” from them to wipe out the balance. Smacks of desperation does it not?

On Tuesday the Treasury Select Committee interviewed Andrew Bailey of the Financial Conduct Authority (FCA) over the closure of the Woodford Equity Income fund and their regulation of it. It is well worth listening to. See https://parliamentlive.tv/Event/Index/34965022-ec99-4243-8d0b-ae3350c31fe4

It seems that technically the fund only made two minor breaches of the 10% limit on unlisted stocks twice in the UCITS rules which were soon corrected in 2018. But Link were responsible for ensuring compliance as they were legally the fund manager as they were the ACD who had delegated management to Neil Woodford’s company. But in the morning of the same day the Daily Telegraph reported that nearly half of the fund investments were actually illiquid including 20% that were nominally listed in such venues as Guernsey and not actively traded. In other words, they were perhaps technically complying with the UCITS rules but their compliance in principle was not the case. Mr Bailey suggested this is where regulation might be best to be changed to be “principle” based rather than “rule” based but surely that would lead to even more “fudges”? The big problem is yet again that the EU, who sets the UCITS rules, produced regulations that lacked any understanding of the investment world.

The Investment Association has suggested a new fund type be allowed which only allows limited withdrawals, e.g. at certain times or on notice. But that does not sound an attractive option to investors. When investors want to sell, they want to sell now.

Bank of England Governor Mark Carney has said open-ended funds are “built on a lie” in that they promise daily liquidity when it may not always be possible. He also suggested they posed a systemic risk to financial stability. Or as Paul Jourdan said at the Amati AIM VCT AGM: “Liquid investments are liquid until they are not”.

There is of course still no sign that Neil Woodford is taking steps to restore confidence in his funds, as I suggested on June the 5th. There needs to be a change in leadership and in name for that to happen. Once a fund has become a dog and untouchable in the minds of investors, and their financial advisors, redemptions will continue. Neil Woodford making reassuring statements will not assist. More vigorous action by Woodford, Link, and the FCA is required. Affected investors should encourage more action.

The Amati AIM VCT (AMAT) had a great year in the year before last as small cap AIM stocks rocketed but last year was a different story. NAV Total Return was down 10% although that was better than their benchmark index. AB Dynamics was the biggest positive contributor – up 93% over the year with Water Intelligence also up 93%. Ideagen was a good contributor (now second biggest holding) and Rosslyn Data was also up significantly. Accesso fell 36% but they are still holding. I asked whether they had purchased more AB Dynamics in the recent rights issue but apparently they could not as it was no longer VCT qualifying.

I also asked about the fall in Diurnal which wiped £1.2 million off the valuation. This was down to clinical trial results apparently. However, fund manager Paul Jourdan is still keen on biotechnology and pharmaceutical firms as he suggested that healthcare is being revolutionised in his concluding presentation – he mentioned Polarean as one example.

Other presentations were from Block Energy – somewhat pedestrian and not a sector I like – and Bonhill Group which was more lively. Bonhill were formerly called Vitesse Media but are growing rapidly from some acquisitions and clearly have ambitions to be a much bigger company in the media space.

It was clear from the presentations that the investee company portfolio is becoming more mature as the successful companies have grown. This arises because they tend to take some profits when a holding becomes large but otherwise like to retain their successful holdings.

All resolutions were passed on a show of hands vote but I queried why all the resolutions got near 10% opposing on the proxy counts which is unusual. It seems this is down to one shareholder whose motives are not entirely clear.

In summary, an educational event and worth attending as most AGMs are.

Roger Lawson (Twitter: https://twitter.com/RogerWLawson )

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Broker Charges, Proven VCT Performance Fee and LoopUp Seminar

The Share Centre are the latest stockbroker to increase their fees. Monthly fee for an ISA account is going up by 4.2% to £5.00 per month with increases on ordinary share accounts and SIPPs also. This is the latest of a number of fee increases among stockbrokers and retail investor platforms. The Share Centre blame the required investment in technology development and “an increasing burden of financial regulation”. The latter is undoubtedly the result of such regulations as MIFID II imposed by the EU which has proven to be of minimal benefit to investors. As I was explaining to my sister over the weekend, this is one reason why I voted to leave the EU – their financial regulations are often misconceived and often aimed at solving problems we never had in the UK.

I received the Annual Report of Proven VCT (PVN) this morning – a Venture Capital Trust. Total return to shareholders was 10.3% last year, but the fund manager did even better. Of the overall profits of the company of £18.6 million, they received £7.7 million in management fees (i.e. they received 41% of the profits this year). That includes £5.6 million in performance fees.

Studying the management fee (base 2.0%) and the performance fee, I find the latter particularly incomprehensible. I will therefore be attending the AGM on the 3rd July to ask some pointed questions and I would encourage other shareholders to do the same. I am likely to vote against all the directors at this company.

I also received an Annual Report for Proven Growth & Income VCT (PGOO) and note that of the 4 directors, 2 have served more than 9 years and one is employed by the fund manager. So that’s three out of four that cannot be considered “independent” so I have voted against them. I would attend their AGM on the same day but the time is 9.30 which is not a good choice and would waste a whole day.

Yesterday I attended the “Capital Markets Day” of LoopUp (LOOP). This is an AIM listed company whose primary product is an audio conference call service. It’s just a “better mousetrap” to quote Ralph Waldo Emerson as 68% of the world are still using simple dial-in services rather than more sophisticated software products such as Zoom and WebEx. There are lots of other competitors in this field including Microsoft’s Skype which I find an appallingly bad product from past experience. Reliability and simplicity of use is key and LoopUp claimed to have solved this with no learning required, no software downloads or other complexities and high-quality calls aimed at the corporate market.

I have seen the company present before and do hold a few shares. This event was again a very professional sales pitch for the company and its product with no financial information provided. Yesterday they also covered the addition of video to their basic conference call service which was announced on the day, plus a new service for managed events/meetings. Video addition is probably an essential competitive advantage that was previously missing. They covered how their service is differentiated from the main competitors which was good to understand.

Last year they acquired a company called MeetingZone which has increased their customer base and revenue substantially and are transitioning the customers to the LoopUp product. Revenue doubled last year and is forecast to rise by about 50% in the current year. Needless to say the company is rated highly on conventional financial metrics and return on capital has been depressed by the cost of the acquisition. But one reason I like this company is that it’s very easy to understand what they do and what the “USP” is that they are promoting, plus their competitive position (many company presentations omit any discussion of competitors).

They also have an exceedingly good sales operation based on groups of people organised in “pods” which was covered in depth in the presentation. These only have team bonuses and the key apparently is to recruit “empathetic” people rather than “individualists”. Perhaps that is one reason 60% of them are female. As I said to their joint CEO, I wish I had seen their presentation some 30 or more years ago when I had some responsibility for a software sales function.

The latter part of this 3-hour event was an explanation of how the software/service is used by major international law firm Clifford Chance with some glowing comments on the company from one of their managers. Customer references always help to sell services.

In conclusion a useful meeting, but lack of financial information was an omission although “Capital Market” days are sometimes like that. But the positive was that they had both institutional investors and private investors whereas some companies deliberately discourage the latter from attending such events which I find most objectionable.

Roger Lawson (Twitter: https://twitter.com/RogerWLawson )

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Big Audit Firm Break-Up and Northern VCT AGM

A report commissioned by the Labour Party has advocated the break-up of the big four audit firms that dominate the audits of FTSE-350 firms. The report, co-authored by Prof. Prem Sikka et al, even goes so far as to suggest that their share of that market should be limited to 50% and that joint audits be promoted. In addition it argues that audit firms should be banned from doing non-audit work for the same company, and an independent body to appoint audit firms and agree their remuneration should be set up.

It also calls for the auditors to owe a duty of care to shareholders, not just the companies they audit, which would enable shareholders to pursue litigation over audit failings which they have great difficulty in doing at present. It is surely sensible to reinstate what was always assumed to be the case before the Caparo judgement.

These are revolutionary ideas indeed to try and tackle the problems we have seen in recent years and it seems to be now generally accepted by investors, if not the audit profession, that there have been too many major failings and the general standard is low. Even the Financial Report Council (FRC) seem to accept that view at a recent meeting with ShareSoc/UKSA.

But would breaking up the big four, effectively forcing some larger companies to use smaller audit firms improve the quality of audits? I rather doubt it. In my experience problems with smaller audit firms are just as common as in large ones – it’s just that the big companies and their audit failings get more publicity. Larger firms do have more expertise in certain areas and more international coverage. So there are good reasons to use them. But this report is certainly worth reading because if Mrs May continues to make a hash of Brexit and proves unable to stop dissension within her party we may see a Labour Government looking to implement these policies. See http://visar.csustan.edu/aaba/LabourPolicymaking-AuditingReformsDec2018.pdf . I may make more comments on the report after I have read the whole 167 pages.

Note that this issue of audit firm size came up at the Northern Venture Trust (NVT) Annual General Meeting which I attended today. This is a long-established Venture Capital Trust – it was their 23rd AGM, many of which I have attended. One shareholder voted against the reappointment of KPMG on the “show of hands” vote, and there were 1.2million votes against them on the proxy counts (versus 10.9 million “for”). It is unusual to see so many voted against such resolutions. When I asked the shareholder why he voted against I was told it was because he thought that a smaller audit firm might do better as VCTs are relatively smaller investment companies. However I pointed out that VCT legislation is very complex so it makes sense to use an audit form that is more knowledgeable in that regard.

The other possible reason for high proxy votes against the auditors is that Nigel Beer, who chairs the Audit Committee is a former partner in KPMG although he told me later that he had departed many years ago. Anyway I did raise this issue in the meeting and the fact that both Nigel Beer and Hugh Younger had just passed 9 years of time on their board. In addition, Tim Levett, who is Chairman of NVM, the fund manager, is on the board. So according to the UK Corporate Governance Code that’s three directors out of 6 who should be considered non-independent.

I urged the Chairman to look at “refreshing” the board although I did not doubt their experience and knowledge. It was also pointed out to me after the meeting that there are no women on the board. So effectively this is really a stale, male, pale board. However the Chairman said they do regularly review board structure and succession.

Other than that there were some interesting comments given by Tim Levett in his presentation. He said that due to the change in the VCT rules in 2016 they have changed from being a late stage investor to being an early stage one. In the last 3 years they have built a new portfolio of 22 early stage companies and are probably the most active generalist VCT manager other than Titan. NVM have opened a new office in Birmingham and built up the Reading office. There were also a number of new staff who were introduced at the meeting.

He also said that like all the top 10 VCTs, an awful lot of special dividends had been paid in the last three years. This was because of realisations and the VCT rules that prevented them from retaining cash. This has meant a reduction in the NAV of the trust but in future they will try and maintain that at the same time as maintaining a 5% dividend. Note: that historically it means that capital has been paid out in tax-free dividends that investors might have reinvested in the trust and hence collected a second round of up-front income tax relief. One can understand why the trust does not want to continue doing that as it may otherwise spark some attention from HMRC. I also prefer to see VCTs maintain their NAV as otherwise the trusts shrink in size which can create problems in due course as we have seen with other VCTs.

NVT are doing a new share issue in January which will of course improve their NAV and I was glad to hear that at least some of the directors will be taking up shares in the offer and adding to their already considerable holdings. That inspires some confidence that they can cope with the changes to the VCT rules that mean there will be more emphasis on investing in riskier early stage companies.

Roger Lawson (Twitter: https://twitter.com/RogerWLawson )

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British Smaller Companies VCT Offer

It’s that time of year when share subscription offers for Venture Capital Trusts (VCTs) tend to be launched. One of the first is that for the British Smaller Companies VCT (BSV). This one that has shown a relatively good performance for a generalist VCT – share price total return of 225 over ten years according to the AIC compared with a sector performance of 136. It also has a high dividend yield and a narrow discount to NAV. However I have never liked their manager’s performance incentive fee arrangement and consistently vote against the Chairman, Helen Sinclair, who introduced it. But they are proposing to change it.

Currently the incentive fee is based simply on dividends paid – at the rate of 20% of those paid – so long as a dividend hurdle is met. There is also a hurdle for Net Asset Value (NAV) which has to be met, which presumably was intended to ensure that the NAV did not fall to too low a level. However, very high dividends can be paid by the company even though the company has lost money on many of its investments. In effect, dividends can be paid out and incentive fee based on them paid to the manager even though the company’s earnings do not cover the dividends. Incentive fees based on dividends paid out in VCTs are simply wrong.

What can happen is that dividends are paid out based on realisations, while ignoring the unrealised losses in the portfolio. This arrangement resulted in a very large incentive fee being paid to the manager in 2017 – dividends of 22.0p paid out when reported earnings were only 4.6p. The result was total management fees of £5.5 million paid when assets at the start of the year were only £96 million.

What is the new management fee arrangement? In essence it will remain dividend based with the same 20% figure. The only change is to introduce a Total Return hurdle to replace the Net Asset hurdle. There are other changes and complications to the incentive agreement which are very difficult to understand, including an overall cap, for which you need a spreadsheet to understand the effect. But the company says “Note that the historic incentive payments would have been significantly lower if the proposed incentive arrangements had been in place since 2009 due to this cap”. I’ll take their word on it, but it’s still a bad arrangement and should be simplified.

There is also going to be a reduction in the fixed “investment advisor fee” of 2% of assets so that only 1% is paid on cash balances held.

Shareholders may wish to vote for these changes as they may be better than the past arrangements but I suggest shareholders write to the Chairman as I shall be doing and complain that the board needs to try harder. This looks like an agreement that has been written by the fund manager. Incentive schemes for fund managers should be simple to understand by shareholders and the board, and not based on dividends paid out but on total return.

Roger Lawson (Twitter: https://twitter.com/RogerWLawson )

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CAKE (Patisserie), Foresight 4 VCT AGM, Payment Companies and Dunelm

More bad news from Patisserie Holdings (CAKE) today – well at least you can’t say the directors are not keeping you informed about their dire situation which is not always the case in such circumstances.

Yesterday the company announced that its major operating company had received a winding-up petition from HMRC, of which the directors had only recently become aware. Today the company said after further investigation the board has reached the conclusion that without an “immediate injection of capital, the Directors are of the view that there is no scope for the business to continue trading in its current form”.

The directors could possibly try to do a quick placing at a deep discount no doubt, borrow a pile of cash at extortionate rates or they could put it into administration. The big risk is that Exec Chairman Luke Johnson will put it through a pre-pack administration. I hope he does not because that won’t do his reputation any good at all. He needs to try and engineer some sensible solution if his reputation in the financial world is to remain intact. That is particularly so after he wrote an article for the Times in September on “a beginner’s guide to tried and tested swindles” suggesting how you can spot them. Clearly he was not taking his own advice. Whatever happens, the outlook for existing shareholders does not look good.

As another commentator said, the Treasury should not reduce the generous tax reliefs on AIM companies because they need to realise that it is a risky market.

But there was some good news on cake yesterday when the Supreme Court decided after all in an appeal from the lower courts that a cakemaker can refuse to bake cakes where the proposed wording in the icing is objectionable to them. A victory for common sense and liberty.

Today I attended the Annual General Meeting of Foresight 4 VCT (FTF). There is one advantage to owning VCT shares. They barely move when the stock market is otherwise in panic mode. They are one of the few “counter-cyclical” investments to public companies as they invest in private equity. There are some disadvantages of course. Illiquidity in the shares, and often disappointing long-term performance as in Foresight 4. But it may be improving.

I won’t cover the meeting in detail but there were a couple of interesting items in fund manager Russell Healey’s presentation. He mentioned they are still having problems with long delays on HMRC pre-approval of new qualifying investments – can still delay deals for a few months it seems. More representations are being made on this.

He also covered the performance of their top few investments. Datapath, the largest, was valued down because EBITDA fell but revenue is still growing and the fall in profits arose from more product development costs. Ixaris, the second largest, is growing strongly (I knew this because I have a direct holding in it and had just read the December 2017 accounts they filed at Companies House). From my recollection that’s the first year they have made a profit since founding 16 years ago. Russell couldn’t remember how many funding rounds the company had launched – was it 6 or 7, and me neither. That’s venture capital in early stage companies for you – you have to be very patient.

However, in response to a question from VCT shareholder Tim Grattan it was disclosed that VISA are tightening up on the rules regarding pre-payment cards. This might affect a significant part of Ixaris’s business. I suspect it will also affect many other pre-payment card offerings by payment companies, some of whom are listed. Particularly those that are using them to enable payments into gaming companies which Visa does not like.

It was another bad day in the market today, although Dunelm (DNLM) picked up after a very positive trading statement with good like-for-like figures. They are moving aggressively into on-line sales but their physical stores also seem to be producing positive figures so perhaps big retail sheds are still viable. They are not in the High Street of course.

While the market is gyrating I am doing the usual in such circumstances having been through past crashes. Will the market continue to go down, or bounce back up? Nobody knows. So I tend to follow the trend. But I also clear out the duds from my portfolio when the market declines – at least that way I can realise some capital gains losses and reinvest the cash in other shares that are now cheaper. I also look carefully at those stocks that seem to be wildly over-valued on fundamentals – those I sell. But those that suddenly have become cheap on fundamentals I buy, or buy more of. In essence I am not of the “hide under the sheets” mentality in the circumstances of a market rout as some are. But neither do I panic and dump shares wholesale. This looks like a short-term market correction to me at present, after shares (particularly in the USA) became adrift from fundamentals and ended up looking very expensive. But we shall no doubt see whether that is so in the new few days or weeks.

Roger Lawson (Twitter: https://twitter.com/RogerWLawson )

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RIT Capital Partners, Foresight 4 VCT and Sepsis

RIT Capital Partners (RCP) is an investment trust that recently issued its interim report. As one of my longer standing holdings, first purchased in 2003 although I have reduced my holding of late, I read the report with interest. RCP has been a long-standing favourite of private investors having traditionally taken a somewhat defensive investment approach. But the portfolio is now most peculiar. It contains 8.8% of “quoted equities” but many of them are held as “swaps”, 27.7% in “long-only funds”, 19.7% in hedge funds and 0.6% in derivatives. There is 9.1% in direct private investments, 13.2% in private investment funds, 23.1% in “absolute return and credit funds”, 3.0% in “real assets” (which includes gold, silver, corn and soyabean futures) and 2.0% in Government bonds (with more swaps in there also). This is certainly an unusual portfolio to say the least.

Personally when I invest in a fund or an investment trust, I prefer them to invest directly – not pass the buck to some other fund manager. This trust has effectively become a “fund of funds” of late with a large proportion of its investments placed into other funds. Otherwise it appears to be hedging against armageddon.

The Chairman of the company is long-standing Lord Rothschild who is aged 82. When I have attended the AGM of this company I have never been very impressed by the way he handled the meeting or the responses to questions.

The total return net asset value performance in the half year was 3.2%, but 6.2% on share price. The current share price discount to NAV is actually at a premium of 6.8% according to the AIC and the dividend yield is 1.6%. Over ten years the total return (NAV) has been 103% when sector performance was 135%. So it’s not exactly been a great performer. I sold the remainder of my holding after reading the interim report.

Foresight 4 VCT

Another investment trust but of a very different nature is Foresight 4 VCT (FTF) which is of course a venture capital trust. It recently issued its Annual Report for the AGM due on the 11th October. I may attend it although my holding is very small.

The Annual Report does make interesting reading although it fails to mention a past complaint by some shareholders about the over-statement of reserves in the years 2013-2015 which resulted in an illegal dividend allegedly being paid. The auditor, KPMG, who still audits this company make no comment on this and neither do the directors in the Annual Report. But the Audit Committee report does mention that the company has received a letter from the FRC questioning the accounting policy for performance related incentive fees. The company has responded. Both issues are likely to be the subject of questions at the AGM no doubt.

This company has two very large holdings in its portfolio – Datapath and Ixaris. I have been very dubious about the valuations put on the latter company by this and other VCTs as I know quite a lot about the business. I used to be a director and still have a direct holding. This is particularly so after the disclosure by the Ixaris Chairman of the latest business challenges at the recent Oxford Technology VCT meeting.

I will be voting against the reappointment of KPMG as auditors at this company, against the sole director who is standing for re-election (is it not recommended that all directors of fully listed companies stand for re-election?), and against approval of the Report & Accounts.

But FTF did raise some more money this year and is investing in what appear to be interesting companies. One of their new investments has been in Mologic which is a medical diagnostic company. What sparked by particular interest was their product for rapid diagnosis of sepsis which I only narrowly survived a few years ago. Up to 50% of people who develop sepsis die from multiple organ failure, even though it can be treated with antibiotics. It is often misdiagnosed or treatment commenced too late, so a rapid diagnostic tool will be of great use.

Dr Hadiza Bawa-Garba was convicted of gross negligence manslaughter over the death of six-year-old Jack Adcock from sepsis but subsequently challenged being struck of the medical register. She won the latter legal case this week after a big campaign by doctors and a major crowdfunding exercise. Bearing in mind the other contributory factors, and the difficulty in spotting sepsis I consider the original conviction a gross miscarriage of justice. You can feel just slightly under the weather and next minute you are unconscious and in the intensive care unit as I know very well. Jack Adcock had other medical conditions that will not have helped.

There are 44,000 deaths from sepsis every year in the UK, and children are particularly at risk. It appears that cases of sepsis are rapidly rising although that might be due to better diagnosis. Even surviving it can mean life changing injuries. See https://sepsistrust.org/ for more information or if you wish to support a charity that is raising awareness of this deadly disease.

Roger Lawson (Twitter: https://twitter.com/RogerWLawson )

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