TIDMDPV1
DOWNING PROTECTED VCT I PLC
Final results for the year ended 30 June 2009
FINANCIAL HIGHLIGHTS
2009 2008
Pence Pence
Net asset value per share 85.20 106.40
Total distributions paid since inception 54.40 50.90
Total return 139.60 157.30
CHAIRMAN'S STATEMENT
The year ended 30 June 2009 has been a difficult one for most
businesses, as the financial turmoil of 2008 led to the UK economy
remaining in recession in 2009. Although stock markets have since
experienced some level of recovery, conditions remain challenging,
particularly in certain sectors.
Over the last few years, your Company has moved away from its
original model of investing solely in care home businesses, towards
building a more diversified portfolio. Unfortunately the severity of
the downturn has had significant impact on a fair proportion of the
portfolio, leading to a fall in Net Asset Value per share ("NAV").
Net Asset Value
At 30 June 2009, the Company's NAV stood at 85.2p. This represents a
decrease of 17.7p per share against the NAV at 30 June 2008 (after
adjusting for the dividends paid during the year), equivalent to a
fall of 16.6%.
The Company's Total Return (NAV plus cumulative dividends paid since
launch) now stands at 139.6p per share compared to an original
investment, net of income tax relief, at the Company's outset, of
80.0p per share. Although the performance over the year is
disappointing, it is worth noting that the Company remains in the
top 10 best performing of all VCTs on Total Return basis.
Investments
The Company remained close to fully invested throughout the year and
accordingly, investment activity was limited as summarised below.
Congress House Limited underwent a reorganisation whereby the company
was acquired by Blue Cedars Holdings Limited, into which a further
GBP475,000 was invested.
Two investee companies repaid loan stock totalling GBP550,000 at par.
A further investment of GBP400,000 was made into Honeycombe Pubs
Limited in an attempt to recover value in this struggling pub
owner/operator. Progress was disappointing and ultimately the whole
investment disposed of for GBP400,000, realising a gain/loss of nil for
the year.
Further details of the investment management activities over the year
are set out in the Investment Manager's Report below.
As usual, the Board and Investment Manager undertook a detailed
review of the portfolio at the year end. In most cases, independent
third-party valuations were obtained to assist the Directors in
concluding on the current fair value of the investments. A number of
adjustments to the valuations were made including a full provision of
GBP1 million against the investment in Kings Gap Group Limited,
GBP200,000 against the investment in Gatewales Limited and GBP300,000
against Heyford Homes VCT. There were some increases in value in the
Company's investments in care homes for people with special needs,
with Bowman Care Homes and Blue Cedars Holdings being increased by
GBP100,000 and GBP75,000 respectively. The total movement in valuations
over the year was a reduction of GBP1.5 million.
Further details of the valuation movements are included in the
Investment Manager's Report and full details of the portfolio are
included in the Review of Investments.
Results and dividend
The loss on ordinary activities after taxation was GBP1,444,000 (2008:
gain GBP57,000) comprising revenue return of GBP130,000 (2008: GBP334,000)
and a capital loss of GBP1,574,000 (2008: loss GBP277,000).
Your Board is proposing to pay a final dividend of 2.0p per share
(comprising 1.5p revenue and 0.5p capital), which, subject to
Shareholder approval, will be paid on 11 December 2009 to
Shareholders on the register at 13 November 2009. This will result
in dividends for the year totalling 3.0p per share (2008: 5.25p per
share).
The payment of this dividend will bring total distributions to
Shareholders since the Company's launch to 56.4p per share.
Share buybacks
Your Board continues to monitor the market in the Company's shares
and, in order to ensure liquidity for Shareholders, the Company has a
policy of purchasing its own shares when any become available if it
is not restricted from doing so. A special resolution to allow the
Company to continue with this policy is proposed for the forthcoming
AGM.
During the year the Board used this power to repurchase 107,000
shares for an average consideration of 91.4p per share. Shareholders
should be aware that those who deferred a capital gain by investing
in this VCT will crystallise the gain when or if they sell their
shares. Therefore, any Shareholders considering selling their
holding are recommended to take advice from their financial adviser
prior to making any investment decision.
Annual General Meeting
The thirteenth AGM of the Company will be held at Kings Scholars
House, 230 Vauxhall Bridge Road, London SW1V 1AU at 11 a.m. on 8
December 2009. Three items of special business will be proposed in
respect the following:
(i) share buybacks,
(ii) authority to issue shares without regard to pre-emption rights,
and
(iii) updating the Company's Articles of Association to reflect the
ability, introduced by Companies Act 2006, of the Directors to change
the name of the Company without the need to seek Shareholder
approval.
Outlook
The fall in NAV experienced by the Company over the year is
disappointing but not entirely surprising given the sharp decline in
economic conditions and general financial turmoil seen during the
early part of the year. There are signs that the economy has now
stabilised, although speculation about recovery may be premature and
over-optimistic.
The Company's portfolio now appears to have reasonably limited
downside. There also appear to be opportunities for building value,
however it may be that these cannot be exploited until general
economic conditions improve.
Despite the falls in values over the year, the Company's investment
portfolio has continued to produce a steady yield. This supports the
Board's intention of maintaining a strong dividend policy, which is
expected to continue over the coming year.
The Board is aware that, with net assets of GBP6.9 million, your
Company is now small for a VCT. The Board is therefore considering
the possibility of launching a top-up fundraising before the end of
the current tax year which would help to increase the size of the
Company. Full details will be sent to Shareholders as soon as they
become available.
Chris Kay
Chairman
INVESTMENT MANAGER'S REPORT
Introduction
With the Company effectively fully invested, investment activity has
been reasonably limited during the year ended 30 June 2009. However,
the deteriorating economic conditions have meant that the existing
portfolio companies have demanded close attention.
Investment activity
The new investments that were made during the year were as follows:
GBP'000
Reorganisation
Blue Cedars Holdings Limited 850
Follow-on investment
Honeycombe Pubs VCT Limited 400
1,250
Disposals and other realisations are summarised as follows:
Gain/
(loss)
against Gain/
original (loss)
Cost Proceeds cost in year
GBP'000 GBP'000 GBP'000 GBP'000
Reorganisation
Congress House Limited 375 375 - -
Loan stock redemptions
Downing Office Villages Contractor
Limited 250 250 - -
Heyford Homes (Thornton Hall) Limited 300 300 - -
Full disposal
Honeycombe Pubs VCT Limited 875 400 (475) -
Release of retention monies
Meadows - 14 14 14
1,800 1,339 (461) 14
In July 2008, a reorganisation took place whereby Blue Cedars
Holdings Limited acquired the whole of the share capital of an
existing investment, Congress House Limited. The reorganisation
allowed the original investment partner to exit, the Company to make
a further net investment of GBP475,000 and the team that manages the
Blue Cedars care home to take a stake in the business. Since the
reorganisation, the business has made good progress.
Downing Office Villages Contractor Limited and Heyford Homes
(Thornton Hall) Limited have both been involved in building a
residential development in Northamptonshire. As the project has
progressed both companies have been able to repay loan stock to the
Company totalling GBP550,000.
Honeycombe Pubs VCT Limited, which owns and operates a pub in
Burnley, continued to face difficulties throughout the year.
Initially the Company made a further investment into Honeycombe to
eliminate third party borrowings; however the Board felt that
Honeycombe was not making sufficient progress and took an opportunity
to exit from the investment at an amount equal to the follow-on
investment. As a full provision had been made against the investment
in the previous year, there was no realised gain or loss for the
year.
Investment valuations
The difficult economic climate has created challenges for many of the
investee companies, resulting in a mixed performance across the
portfolio.
The investee companies which own and operate care homes for people
with special needs (Bowman Care Homes Limited, Blue Cedars Holdings
Limited and Downing (Pirbright Road) Limited) have each made progress
in improving cost control and occupancy levels over the year. As a
result we have increased the valuation of Bowman Care Homes and Blue
Cedars Holdings by GBP100,000 and GBP75,000 respectively. In respect of
Downing (Pirbright Road) some minor adjustments to the care home are
being planned which should assist in the recruitment of residents for
the home's two remaining places.
Kimbolton Lodge Limited, which owns and operates a care home for the
elderly in Bedford, has struggled to sustain occupancy levels. A new
management team has recently been appointed and initial signs are
positive that the new team may be able to improve occupancy while
keeping operating costs under control. The investment has been
valued at the year end at GBP750,000, being a fall of GBP50,000 since the
last year end, although an increase of GBP50,000 compared to the
half-year valuation.
Kings Gap Group Limited owns and operates a hotel in Hoylake near
Liverpool which was acquired partly because of attractive development
opportunities on the site. In the current climate, progress in
exploring the development opportunities has been slow. In addition,
trading at the hotel has deteriorated. An independent report
suggests that the current valuation of the hotel and land is now
approximately only equal to the level of third party borrowings in
the company. As a result we have recommended a full provision
against the original GBP1 million cost of the investment. This is very
disappointing, however we believe that development opportunities
remain and can allow the Company to recover value in the medium-term.
Gatewales Limited disposed of its interest in The Gateway to Wales
Hotel in September 2008, leaving the company with its main asset
being a plot of development land near Chester. Some well-advanced
plans to build apartments on the land fell through at a late stage
and alternative plans are now being pursued. A recent valuation of
the land suggests that it has fallen in value in the current market
and accordingly we have made a provision of GBP200,000 against the
original cost of GBP1 million. As with Kings Gap above, we believe
there will be opportunities for this company to recover value in due
course.
The Company has interests in three contractor/ developer companies
(Downing Office Villages Contractors Limited, Heyford Homes (Thornton
Hall) Limited, and Heyford Homes (VCT) Limited) each of which have
exposure to residential developments. As mentioned above Downing
Office Villages (Contractor) and Heyford Homes (Thornton Hall) repaid
loan stock during the year, however a small provision of GBP72,000 has
been made against Heyford Homes (Thornton Hall) Limited in view of
the uncertainty about the final outcome of the development project.
Heyford Homes VCT is completing work on a development of six houses
near Northampton. It is not yet clear what selling prices are
achievable in the current market, however we have made a provision of
GBP300,000 against the original GBP1 million cost as a result of this
uncertainty. Reports in the media that the housing market has made
some recovery may mean that we ultimately are able to recover our
original cost.
Investment income
The portfolio continues to generate a satisfactory yield. Investment
income for the year ended 30 June 2009 was GBP432,000 compared to
GBP662,000 in the previous year. Although this has fallen a little
from the previous year, partly as a result of the fall in base rate,
this income once again allows the Company to pay a reasonable level
of revenue dividends to Shareholders.
Conclusion
Naturally the falls in value experienced by some investments over the
year are disappointing; however we take some comfort from the fact
that each of these investments has a significant chance of recovering
value in time. We expect these investments to demand more management
time over the coming year.
The Company's investments in care homes still make up a significant
proportion of the portfolio and continue to provide a steady yield as
they build value. We believe that this can continue over the coming
year.
Downing Protected Managers I Limited
REVIEW OF INVESTMENTS
Portfolio of Investments
The following investments, all of which are incorporated in England
and Wales, were held at 30 June 2009:
Valuation
movement % of
Cost Valuation in year portfolio
GBP'000 GBP'000 GBP'000 by value
Venture Capital
Investments
Bowman Care Homes Limited 1,000 1,350 100 19.5%
Blue Cedars Holdings 850 925 75 13.4%
Limited
Downing (Pirbright Road) 700 950 - 13.7%
Limited
Gatewales Limited 1,000 800 (200) 11.6%
Kimbolton Lodge Limited 605 750 (50) 10.8%
Heyford Homes (VCT) 1,000 700 (300) 10.1%
Limited
Downing Office Villages 600 600 - 8.7%
Contractor Limited
Bond Contracting Limited 200 100 (100) 1.4%
Sanguine Hospitality 6 6 - 0.1%
Limited
Kings Gap Group Limited 1,000 - (1,000) 0.0%
Heyford Homes (Thornton 72 - (72) 0.0%
Hall) Limited
Sundry 50 - - 0.0%
7,083 6,181 (1,547) 89.3%
Cash at bank and in hand 740 10.7%
Total investments 6,921 100%
Statement of Directors' responsibilities
The Directors are responsible for preparing the Annual Report, the
Directors Remuneration Report, and the financial statements in
accordance with applicable law and regulations. They are also
responsible for ensuring that the annual report includes information
required by the Listing Rules of the Financial Services Authority.
Company law requires the directors to prepare financial statements
for each financial year. Under that law the directors have elected to
prepare the financial statements in accordance with United Kingdom
Generally Accepted Accounting Practice (United Kingdom Accounting
Standards and applicable law). Under company law the directors must
not approve the financial statements unless they are satisfied that
they give a true and fair view of the state of affairs of the company
and of the profit or loss of the company for that period. In
preparing these financial statements the directors are required to:
* select suitable accounting policies and then apply them
consistently;
* make judgments and estimates that are reasonable and prudent;
* state whether applicable accounting standards have been followed,
subject to any material departures disclosed and explained in the
financial statements; and
* prepare the financial statements on the going concern basis unless
it is inappropriate to presume that the company will continue in
business.
The directors are responsible for keeping adequate accounting records
that are sufficient to show and explain the company's transactions
and disclose with reasonable accuracy at any time the financial
position of the company and enable them to ensure that the financial
statements comply with the Companies Act 2006. They are also
responsible for safeguarding the assets of the company and hence for
taking reasonable steps for the prevention and detection of fraud and
other irregularities.
The directors are responsible for the maintenance and integrity of
the corporate and financial information included on the company's
website. Legislation in the United Kingdom governing the preparation
and dissemination of the financial statements and other information
included in annual reports may differ from legislation in other
jurisdictions.
Statement as to disclosure of information to auditors
The Directors in office at the date of the report have confirmed, as
far as they are aware, that there is no relevant audit information of
which the auditors are unaware. Each of the Directors have confirmed
that they have taken all the steps that they ought to have taken as
Directors in order to make themselves aware of any relevant audit
information and to establish that it has been communicated to the
auditors.
By order of the Board
Grant Whitehouse
Secretary
Kings Scholars House
230 Vauxhall Bridge Road
London SW1V 1AU
INCOME STATEMENT
for the year ended 30 June 2009
Year ended 30 June 2009 Year ended 30 June 2008
Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Income 432 - 432 662 - 662
Losses on investments - (1,533) (1,533) - (205) (205)
432 (1,533) (1,101) 662 (205) 457
Investment management (19) (57) (76) (23) (69) (92)
fees
Management incentive - - - (27) (34) (61)
fees
Other expenses (234) - (234) (160) - (160)
Return on ordinary 179 (1,590) (1,411) 452 (308) 144
activities
before tax
Tax on ordinary (49) 16 (33) (118) 31 (87)
activities
Return attributable
to equity 130 (1,574) (1,444) 334 (277) 57
Shareholders
Basis and diluted
return per 1.6p (19.4p) (17.8p) 4.0p (3.3p) 0.7p
share
All Revenue and Capital items in the above statement derive from
continuing operations. The total column within the Income Statement
represents the profit and loss account of the Company.
A Statement of Total Recognised Gains and Losses has not been
prepared as all gains/losses are recognised in the Income Statement
as noted above.
Other than revaluation movements arising on investments held at fair
value through the Income Statement, there were no differences between
the return/deficit as stated above and historical cost.
RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
for the year ended 30 June 2009
Year ended Year ended
30 June 2009 30 June 2008
GBP'000 GBP'000
Opening Shareholders' funds 8,696 9,415
Purchase of own shares (99) (253)
Total recognised gains for the year (1,444) 57
Distributions paid (283) (523)
Closing Shareholders' funds 6,870 8,696
BALANCE SHEET
as at 30 June 2009
2009 2008
GBP'000 GBP'000 GBP'000 GBP'000
Fixed asset
Investments 6,181 7,803
Current assets
Debtors 167 170
Cash at bank and in hand 740 916
907 1,086
Creditors: amounts falling due within one (218) (193)
year
Net current assets 689 893
Net assets 6,870 8,696
Capital and reserves
Called up share capital 4,032 4,086
Capital redemption reserve 874 820
Special reserve 1,969 2,584
Capital reserve - realised 778 764
Capital reserve - unrealised (902) 170
Revenue reserve 119 272
Total shareholders' funds 6,870 8,696
Basis and diluted net asset value per share 85.2p 106.4p
CASH FLOW STATEMENT
for the year ended 30 June 2009
Year ended Year ended
30 June 30 June
2009 2008
GBP'000 GBP'000
Net cash inflow from operating activities 205 297
Taxation
Corporation tax paid (88) (99)
Capital expenditure
Purchase of investments (1,250) (1,225)
Sale of investments 1,339 2,075
Net cash inflow from capital expenditure 89 850
Dividends paid (283) (523)
Net cash (outflow)/inflow before financing (77) 525
Financing
Repurchase of shares (99) (300)
Net cash outflow from financing (99) (300)
(Decrease)/Increase in cash (176) 225
NOTES TO THE ACCOUNTS
for the year ended 30 June 2009
1. Accounting policies
Basis of accounting
The Company has prepared its financial statements under UK Generally
Accepted Accounting Practice ("UK GAAP") and in accordance with the
Statement of Recommended Practice "Financial Statements of Investment
Trust Companies" revised January 2009 ("SORP").
The financial statements are prepared under the historical cost
convention except for the revaluation of certain financial
instruments and on the basis that it is not necessary to prepare
consolidated accounts.
Presentation of Income Statement
In accordance with SORP, supplementary information which analyses the
income statement between items of a revenue and capital nature has
been presented alongside the income statement. The net revenue is the
measure the Directors believe appropriate in assessing the Company's
compliance with certain requirements set out in Part 6 of the Income
Tax Act 2007.
Investments
Venture capital investments are designated as "fair value through
profit or loss" assets due to investments being managed and
performance evaluated on a fair value basis. A financial asset is
designated within this category if it is both acquired and managed on
a fair value basis, with a view to selling after a period of time, in
accordance with the Company's documented investment policy. The fair
value of an investment upon acquisition is deemed to be cost.
Thereafter investments are measured at fair value in accordance with
the International Private Equity and Venture Capital Valuation
Guidelines "IPEV" together with FRS26.
For unquoted investments, fair value is established by using the
IPEV. The valuation methodologies for unquoted entities used by the
IPEV to ascertain the fair value of an investment are as follows:
* Price of recent investment;
* Earnings multiple;
* Net assets;
* Discounted cash flows or earnings (of underlying business);
* Discounted cash flows (from the investment); and
* Industry valuation benchmarks.
The methodology applied takes account of the nature, facts and
circumstances of the individual investment and uses reasonable data,
market inputs, assumptions, estimates in order to ascertain fair
value.
The unrealised depreciation or appreciation arising on the valuation
of investments and gains and losses arising on the disposal of
investments are dealt with in the capital reserve.
It is not the Company's policy to exercise significant influence over
investee companies. Therefore the results of these companies are not
incorporated into the income statement except to the extent of any
income accrued. This is in accordance with the SORP that does not
require portfolio investments to be accounted for using the equity
method of accounting.
Income
Dividend income from equity shares is recognised when the
shareholders' rights to receive payment has been established,
normally the ex dividend date.
Fixed returns on non-equity shares and on debt securities are accrued
on a time apportionment basis, by reference to the principal sum
outstanding and at the effective rate applicable and only where there
is reasonable certainty of collection. Monitoring income is accrued
net of VAT and only where there is reasonable certainty of
collection.
Expenses
All expenses are accounted for on an accruals basis. In respect of
the analysis between revenue and capital items presented within the
income statement, all expenses have been presented as revenue items
except as follows:
Expenses which are incidental to the disposal of an investment are
deducted from the disposal proceeds of the investment.
Expenses are split and presented partly as capital items where a
connection with the maintenance or enhancement of the value of the
investments held can be demonstrated. The Company has adopted the
policy of allocating investment manager's fees, 75% to the capital
reserve and 25% to the revenue account, as permitted by the SORP.
The allocation is in line with the Board's expectation of long term
returns from the Company's investments in the form of capital gains
and income respectively.
Deferred Taxation
The tax effects on different items in the income statement are
allocated between capital and revenue on the same basis as the
particular item to which they relate using the Company's effective
rate of tax for the accounting period.
Due to the Company's status as a Venture Capital Trust and the
continued intention to meet the conditions required to comply with
Part 6 of the Income Tax Act 2007, no provision for taxation is
required in respect of any realised or unrealised appreciation of the
Company's investments which arise.
Deferred taxation is provided in full on timing differences that
result in an obligation at the balance sheet date to pay more tax, or
a right to pay less tax, at a future date, at rates expected to apply
when they crystallise based on current tax rates and law. Timing
differences arise from the inclusion of items of income and
expenditure in taxation computations in periods different from those
in which they are included in the accounts.
2. Basic and diluted return per share
Revenue return per share is based on the net revenue after taxation
of GBP130,000 (2008: GBP334,000) in respect of 8,118,628 (2008:
8,336,239) shares, being the weighted average number of shares in
issue during the year.
Capital return per share is based on the net capital loss (which
includes unrealised losses) for the financial year of GBP1,574,000
(2008: loss GBP277,000) in respect of 8,118,628 (2008: 8,336,239)
shares, being the weighted average number of shares in issue during
the year.
As the Company has not issued any convertible securities or share
options, there is no dilutive effect on return per share. The return
per share disclosed therefore represents both basic and diluted
return per share.
3. Basis and diluted net asset value per Share
2009 2008
Net asset Net asset
value per Net asset value per Net asset
share value share value
pence GBP'000 pence GBP'000
Ordinary shares 85.2 6,870 106.4 8,696
Net asset value per Ordinary Share is based on net assets at the year
end, and on 8,064,773 (2008: 8,171,773) Ordinary Shares, being the
number of Ordinary Shares in issue at the year end.
As the Company has not issued any convertible securities or share
options, there is no dilutive effect on the net asset value per
share. The net asset value per share disclosed therefore represents
both basic and diluted return per share.
4. Principal financial risks
The principal financial risks faced by the Company, which include
interest rate, liquidity, investment and marketability risks.
In addition to these risks, the Company, as a fully listed Company on
the London Stock Exchange and as a Venture Capital Trust, operates in
a complex regulatory environment and therefore faces a number of
related risks. A breach of the VCT Regulations could result in the
loss of VCT status and consequent loss of tax reliefs currently
available to shareholders and the Company being subject to capital
gains tax. Serious breaches of other regulations, such as the UKLA
Listing rules and the Companies Acts 1985 and 2006, could lead to
suspension from the Stock Exchange and damage to the Company's
reputation.
The Board reviews and agrees policies for managing each of these
risks. They receive quarterly reports from the Managers which monitor
the compliance of these risks and place reliance on the Managers to
give updates in the intervening periods. These policies have remained
unchanged since the beginning of the financial period.
As a VCT, the majority of the Company's assets are represented by
financial instruments which are held as part of the investment
portfolio. In order to ensure continued compliance with relevant VCT
regulation and to be in a position to deliver the long term capital
growth which is part of the Company's investment objective, the Board
is very much aware of the need to manage and mitigate the risks
associated with the financial instruments held within the investment
portfolio.
Credit risk
Credit risk is the risk that a counterparty to a financial instrument
is unable to discharge a commitment to the Company made under that
instrument.
Investments in loan stocks comprise a fundamental part of the
Company's venture capital investments and are managed within the main
investment management procedures.
Cash is mainly held by Bank of Scotland plc, which is an AA- rated
financial institution and, consequently, the Directors consider that
the risk profile associated with cash deposits is low.
Interest, dividends and other receivables are predominantly covered
within the investment management procedures.
Market risk
The key market risks to which the company is exposed is interest rate
risk and, to a lesser extent, market price risk.
Interest rate risk
The Company's future cash flows can be influenced by changes in
interest rates resulting in an increase or decrease in income from
investments linked to the base rate. The maximum exposure to this
risk amounts to the value of floating rate assets of GBP1.0 million
(2008: GBP1.8 million).
Market price risk
Market price risk arises from uncertainty about fair values or future
cash flows of financial instruments because of changes in market
prices.
The Company has no holdings in any listed or quoted equities so has
no direct exposure to substantial movements experienced by stock
markets. As none of the financial instruments held by the Company
are traded on any specified stock market, the Company is not exposed
to a quantifiable equity price risk.
The Company does however have some exposure to the markets for the
various assets held by its investee companies. The ability of the
Company to realise the investments at their carrying value may at
times not be possible if there are no willing purchasers. The
ability of the Company to purchase or sell investments is also
constrained by the requirements set down for Venture Capital Trusts.
The Board considers each investment purchase to ensure that an
acquisition will enable the Company to continue to have an
appropriate spread of market risk and that an appropriate risk reward
profile is maintained.
It is not the Company's policy to use derivative instruments to
mitigate market risk, as the Board believes that the effectiveness of
such instruments does not justify the cost involved.
Liquidity risk
Liquidity risk is the risk that the Company encounters difficulties
in meeting its obligations associated with its financial
liabilities.
The Company has a low level of creditors and has no borrowings. Cash
requirements are continually reviewed by the Investment and
Administration Managers to ensure that sufficient cash and liquid
investments are always held. The main cash outflows, such as new
investments and dividends, are within the control of the Company.
For these reasons, the Board considers that the Company exposure to
liquidity risk is low.
Announcement based on audited accounts
The financial information set out in this announcement does not
constitute the Company's statutory financial statements in accordance
with section 434 Companies Act 2006 for the year ended 30 June 2009,
but has been extracted from the statutory financial statements for
the year ended 30 June 2009, which were approved by the Board of
Directors on 29 October 2009 and will be delivered to the Registrar
of Companies following the Company's Annual General Meeting. The
Independent Auditor's Report on those financial statements was
unqualified and did not contain any emphasis of matter nor statements
under s 498(2) and (3) of the Companies Act 2006.
The statutory accounts for the year ended 30 June 2008 have been
delivered to the Registrar of Companies and received an Independent
Auditors report which was unqualified and did not contain any
emphasis of matter nor statements under S237(2) or (3) of the
Companies Act 1985.
A copy of the full annual report and financial statements for the
year ended 30 June 2009 will be printed and posted to shareholders
shortly. Copies will also be available to the public at the
registered office of the Company at Kings Scholars House, 230
Vauxhall Bridge Road, London SW1V 1AU and will be available for
download from www.downing.co.uk.
=--END OF MESSAGE---
This announcement was originally distributed by Hugin. The issuer is
solely responsible for the content of this announcement.
Downing Protected Vct I (LSE:DPV1)
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Downing Protected Vct I (LSE:DPV1)
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