TIDMBNS 
 
Baronsmead VCT 4 plc 
 
Half-yearly Report 
 
 
Baronsmead VCT 4 plc 
 
 
Half-yearly report for the six months ended 
 
30 June 2010 
 
 
 
 
 
Investment Objective 
 
 
Baronsmead VCT 4 is a tax efficient listed company which aims to achieve 
long-term investment returns for private investors. 
 
 
Investment policy 
 
 
To invest primarily in a diverse portfolio of UK growth businesses, whether 
unquoted companies or traded on AIM. 
 
 
 
Investments are made selectively across a range of sectors in companies that 
have the potential to grow and enhance their value. 
 
 
 
Dividend policy 
 
 
The Board of Baronsmead VCT 4 has the objective to sustain a progressive 
dividend policy for shareholders but this depends primarily on the level of 
profitable realisations and it cannot be guaranteed. There will be variations 
in the amount of dividends paid year on year. 
 
 
 
Secondary market in the shares of Baronsmead VCT 4 
 
 
The existing shares of the Company are listed on the London Stock Exchange and 
can be bought and sold using a stockbroker in the same way as shares of any 
other listed company. 
 
Qualifying investors* who invest in the existing shares of the Company can 
benefit from: 
 
 
 
Tax free dividends; 
 
 
Realised gains are not subject to capital gains tax (although any realised 
losses are not allowable); 
 
 
 
No minimum holding period; and 
 
 
No need to include VCT dividends in annual tax returns. 
 
 
The UK tax treatment of VCTs is on a first in first out basis and therefore tax 
advice should be obtained before shareholders dispose of their shares and also 
if they deferred a capital gain in respect of new shares acquired prior to 6 
April 2004. 
 
 
 
*  UK income tax payers, aged 18 or over, who acquire no more than GBP200,000 
worth of VCT shares in a tax year. 
 
 
 
www.baronsmeadvct4.co.uk 
 
 
 
 
Financial Headlines 
 
 
 
3.0p      Interim dividend of 3.0p per share (unchanged from prior year) 
payable on 15 September 2010 to shareholders on the register at 20 August 2010. 
 
 
 
4.7%     NAV per share increased by 4.7 per cent over the six month period to 
30 June 2010 from 90.63p to 94.86p before payment of the 3.0p interim dividend. 
 
 
 
143.5p  NAV total return to ordinary shareholders for every 100p invested since 
launch. 
 
 
 
8.4%     Dividend yield of 8.4 per cent tax free to qualifying shareholders 
(gross equivalent yield for a higher rate taxpayer is 12.5 per cent). This is 
based on the 3.0p interim dividend payable in September 2010 plus the 4.0p 
dividend paid in December 2009 divided by the mid ordinary share price of 
83.25p at 30 June 2010. 
 
 
 
Summary Since Launch 
 
 
 
Performance Summary to 30 June 2010 
 
 
 
Total return and share price* 1 year 3 year 5 year Since launch 
                                %      %      %         % 
 
Net asset value|                 8.9  (9.3)   18.2         43.5 
 
Share price|                     6.6  (7.9)   23.0         24.3 
 
FTSE All-share                  21.1 (16.2)   18.7         35.4 
 
 
 
 
* Source: ISIS EP LLP and AIC. 
 
| These returns for Baronsmead VCT 4 ignore up front tax relief and the impact 
of receiving dividends tax free. 
 
 
 
Cash Returned to Shareholders 
 
 
 
The Board is also aware that shareholders are concerned that the original 
capital subscribed into Baronsmead VCT 4 has been maintained. The table below 
shows the cash returned to shareholders dependent on their subscription cost, 
including their income tax reclaimed on subscription. 
 
 
 
Year subscribed                                    Net Cumulative 
                      Subscription Income tax     cash  Dividends Net annual  Gross 
                             price    reclaim invested     paid/      yield| yield| 
                                 p          p        p  declared*          %      % 
                                                                p 
 
2002                         100.0       20.0     80.0       41.0        6.0    8.9 
 
2006 (C Shareholders)        100.0       40.0     60.0       18.8        7.3   10.8 
 
2010 (March)                  95.9       28.8     67.1        3.0         -^     -^ 
 
 
 
 
*  Includes proposed interim dividend of 3.0p to be paid on 15 September 2010. 
 
| Net annual yield represents the cumulative dividends paid expressed as an 
annualised percentage of the net cash  invested. 
 
| The gross equivalent yield if the dividends had been subject to higher rate 
tax (32.5 per cent on dividend income at 30 June 2010). As from the tax year 
2010/11, a new additional rate of tax on dividend income of 42.5 per cent came 
into force for those who earned more than GBP150,000. For those Shareholders who 
would otherwise pay this higher rate of tax on dividends, the future gross 
equivalent yield will be higher than the figures shown. 
 
^  The table above excludes returns for shareholders who subscribed in the 
Joint Offer with Baronsmead VCT 3 plc as those returns are not yet meaningful. 
 
 
 
 
Chairman's Statement 
 
 
 
I am very pleased to present my first report since becoming Chairman following 
the retirement of Philip Dunne at the 8th Annual General Meeting held in May 
2010. On behalf of the Board and shareholders, our grateful thanks go to Philip 
who led the Board with great success from the formation of Baronsmead VCT 4 in 
late 2001. 
 
 
 
The 4.7 per cent growth in Net Asset Value ("NAV") per share continues the 
positive trend since November 2008 with increasing profits from many of our 
portfolio companies. The 3p interim dividend matches that of the last three 
years. 
 
 
 
Results 
 
 
 
In the six months to 30 June 2010, the NAV per share increased by 4.7 per cent 
from 90.63p to 94.86p before payment (due on 15 September 2010) of a 3p per 
share interim dividend. This dividend arises both from the capital profits 2p 
and net revenues of 1p per share. The increase in NAV per share is primarily 
due to the 9.2 per cent increase in the value of the unquoted portfolio. The 
FTSE All-Share Index decreased 7.9 per cent over the same period. 
 
 
 
At the period end, over 70 per cent of the ordinary capital raised (net of 
launch costs) prior to 31 December 2007 was invested in VCT qualifying 
investments and the five other VCT qualifying tests had also been met. 
 
 
 
Long term performance 
 
 
 
The interim dividend will take the cumulative dividends paid (tax free for 
qualifying shareholders) for founder shareholders in 2001 to 41p per share on 
their original GBP1 investment, during which time there were two major Stock 
Market downturns. 
 
 
 
The fund raisings by Baronsmead VCT 4 in 2001 and 2006 have achieved positive 
absolute returns. The comparable returns for the FTSE All-Share Index over 
several time periods are set out above and comparable returns with other VCTs 
can be seen on the website of the Association of Investment Companies ("AIC") 
who publish monthly data, www.theaic.co.uk. 
 
 
 
The benefit of VCT tax reliefs on the dividends is set out in the table titled 
'Cash returned to shareholders'. Over the longer term, the benefit can be very 
significant: had this tax relief not been available, then a higher rate tax 
payer would have needed to receive another 20p per share in dividends since 
inception to have had the same after tax income from Baronsmead VCT 4. The tax 
relief will be of increased value from the 2010/2011 tax year to shareholders 
whose income exceeds GBP150,000 p.a as the highest dividend tax rate has 
increased from 32.5 per cent to 42.5 per cent. 
 
 
 
Portfolio review 
 
 
 
The current portfolio comprises fifty-nine companies from a total of over one 
hundred investments made since the outset. Five companies were acquired in the 
period, four were sold and one AIM investment was written off. 52 per cent by 
value is invested in unquoted companies, 17 per cent in AIM & listed companies 
and the balance of 31 per cent in cash or government securities. The largest 
unquoted investment, Nexus Vehicle Holdings, and the largest AIM investment, 
IDOX, represented 7.0 and 1.6 per cent of Net Asset Value respectively. 
 
 
 
Each quarter the Board subjects the whole portfolio to a rigorous review. In 
the last three quarters, the number of companies in the portfolio showing 
steady or improving performance has increased to 97 per cent. The investment 
strategy is aimed at companies less susceptible to general economic conditions, 
which can be seen by the robust performance of the unquoted portfolio during 
the recessionary period. A number of AIM companies have also been acquired by 
trade buyers from the portfolio signalling good value within their sectors. The 
portfolio as a whole has limited exposure to public spending. 
 
 
 
Unquoted portfolio 
 
 
 
The value of the current portfolio of unquoted investments is 31 per cent 
higher than original cost. Sixteen companies are valued at or higher than cost 
whilst two are valued below cost. These period end figures exclude two unquoted 
company realisations, Active Assistance in March 2010 for 2.8 times cost and 
Occam DM at 1.5 times cost in May 2010. 
 
 
 
The first investment in Active Assistance was in March 2008. The business 
provides a national live-in care service for adults and children with spinal 
cord injuries and neurological conditions. The sale involved a merger with 
another health care business, First Call Care Services, to create a national 
provider of both live-in and live-out care to individuals with complex long 
term conditions. 
 
 
 
Occam DM was the longest standing unquoted investment in the portfolio since 
first investing in July 2004. It is a leading provider of marketing management 
software and direct marketing solutions with a blue chip client base in both 
the public and private sectors. The business was sold to St Ives Group in May 
2010 having been valued at 25 per cent of cost in December 2009. The Chairman 
of Occam DM commented "We were acutely aware of the rapidly changing 
marketplace and, with ISIS' support and backing, we have been able to transform 
the company into one of the leading direct marketing solutions businesses". 
 
 
 
AIM-traded & listed portfolio 
 
 
 
This share portfolio was down 4 per cent over the six months under review as 
the UK quoted markets lost some of their earlier recovery due to concerns about 
government deficits and economic growth. 
 
 
 
Realised profits totalled GBP204,000 with the main success coming from the 
disposal of 50 per cent of the shares held in Advanced Computer Software at 2.1 
times cost at the time of flotation in July 2008. 
 
 
 
New investment 
 
 
 
Unquoted investment totalled GBP3.5 million in the six months under review 
comprising investment in Surgi C, Inspired Thinking Group and Getting Personal 
plus two further round financings into Independent Living Services and Nexus 
Vehicle Holdings. 
 
 
 
Surgi C, the UK's leading independent distributor of spinal implants is based 
in Birmingham. The business has grown strongly as a result of an increasing 
product portfolio and the high levels of education and support it provides to 
spinal surgeons. www.surgi-c.com 
 
 
 
Birmingham based Inspired Thinking Group (ITG) provides services that help 
large marketing departments operate more efficiently, including improved 
procurement of artwork and print management. The new funding was used to 
acquire Total Marketing Service, a provider of workflow management systems to 
marketing departments. 
 
 
 
Getting Personal is a leading online retailer, based in Manchester, which sells 
personalised and unique gifts. The business was established in November 2005 
with just one product, a personalised calendar. 
www.gettingpersonal.co.uk now sells over 4,000 items ranging from personalised 
cards, notebooks, mugs and chocolate to non-personalised items for general 
gifting. 
 
 
 
Existing portfolio company Nexus Vehicle Holdings www.nexusrental.com, a 
leading provider of vehicle rental, used further funding to acquire Adapted 
Vehicle Hire, which is a niche rental business providing adapted vehicles for 
the disabled driver market. 
 
 
 
Two further small investments were made into portfolio company Independent 
Living Services, an acute domiciliary care provider based in Scotland, firstly 
to fund a small acquisition and secondly to repurchase shares. 
www.ilsscotland.com 
 
 
 
The volume of qualifying AIM opportunities also increased from the depressed 
levels of 2009. Some GBP481,000 was invested in qualifying holdings and GBP460,000 
in non-qualifying shareholdings. Three investments in the latter category were 
market purchases in support of the strategy to take more influential stakes by 
the combined Baronsmead VCTs in a smaller number of AIM investments, where a 
likely exit strategy to a trade buyer can be envisaged. 
 
 
 
After the period end, GBP3.5 million was invested by the five Baronsmead VCTs in 
Netcall PLC of which Baronsmead VCT 4 provided GBP687,500. Based in St Ives, this 
AIM-traded company provides software and communication solutions into the call 
centre market, mainly its 'Queuebuster' label. The fund-raising is primarily 
for the acquisition of Telephonetics, which specialises in speech recognition 
software. 
 
 
 
Investment and tax planning 
 
 
 
On 18 January 2010 the Company issued a Joint Offer for Subscription with 
Baronsmead VCT 3 to raise GBP16m in aggregate. This Offer became fully subscribed 
and closed on 17 March with over 70 per cent of the funds raised have been 
invested by the existing shareholders of the Baronsmead VCTs. 
 
 
 
As the Company raised GBP7.56m net of expenses through the Joint Offer it has 
sufficient cash resources to fund all of its operations for at least the next 
12 months. As a result, the Directors do not intend, at this stage, to raise 
further funds through issuing new shares in the current tax year. As many of 
the Company's shareholders are also shareholders in the other Baronsmead VCTs 
they will be informed of any offers that those VCTs may make available during 
the course of the current tax year. 
 
 
 
The Company operates a policy of buying back shares in to Treasury in 
accordance with the resolutions passed by the shareholders. Treasury shares may 
be re-issued at a discount to NAV provided it is at a narrower discount to NAV 
than when they were acquired. During the six months to 30 June 2010, 875,000 
shares were bought back into Treasury at an average discount of approximately 
10.2 per cent to NAV. As a result, as at 30 June 2010 the Company held 
4,668,593 Treasury shares. The Company may re-issue shares out of Treasury in 
order to rectify imbalances in the demand and supply of shares that occur from 
time to time. Amongst other things, depending on the number of shares available 
at the time, the Company may re-issue Treasury shares to ensure there are 
sufficient shares available for the Company's Dividend Reinvestment Plan. 
 
 
 
Board Succession 
 
 
 
In the last annual report, Philip Dunne alerted shareholders that if at the 
General Election he was re-elected as a Member of Parliament and the 
Conservatives formed a Government he would be obliged to resign as a Director. 
Following the events of 6 May, Philip duly did not stand for re-election at the 
Baronsmead VCT 4 AGM held on the 20 May and retired from the Board. 
 
 
 
I was delighted to accept the Board's invitation to become the second Chairman. 
I have followed the private equity sector since 1994 while working for Coutts 
Bank in wealth management. In particular I became heavily involved as a VCT 
adviser to private investors in the earlier years of VCTs before joining the 
Boards of Baronsmead VCT 3 and Baronsmead VCT 4 in 2001. On appointment I 
resigned as Senior Independent Director and Chairman of the Audit and Risk 
Committee, which positions were accepted by Alan Pedder and Ian Kirkpatrick 
respectively. 
 
 
 
In the knowledge that Philip Dunne may have been required to retire from the 
Board, an independent recruitment process led us to the appointment of a new 
director, Robin Williams. He is uniquely qualified to help us continue building 
our Company as he has extensive experience of both public and private companies 
as executive and non-executive director. 
 
 
 
Recent HM Revenue & Customs / HM Treasury announcements regarding VCTs 
 
 
 
The Manager, in conjunction with our trade association, the AIC and other VCT 
Managers, has worked hard over many years to inform HMRC and HM Treasury of the 
positive economic impact from unquoted private equity backed companies. 
 
 
 
The resulting AIC report "Supporting enterprise and growth: the role of Venture 
Capital Trusts" published in March 2010 is based on evidence submitted by 15 
VCT Managers and has helped the Government understand the economic return to 
the state, generated from the investment made in VCTs through providing tax 
relief. Most notably, it states "of the 303 investee companies who provided 
data, the net employment impact since VCT investment has been a 48 per cent 
increase in the total workforce to over 25,402 employees." The percentage 
increase in employment was slightly higher for the twenty-four companies from 
within the Baronsmead portfolios that were used in the survey. 
 
 
 
The changes in VCT legislation within the 22 June 2010 Budget had in fact been 
announced a year earlier but will only probably be enacted for the fiscal year 
starting on 6 April 2011. 
 
 
 
Outlook 
 
 
 
The unquoted portfolio is demonstrating good resilience during the current 
period of economic uncertainty, which will take time to dissipate as the 
overhang of government debt is digested and suitably reduced. Entrepreneurial 
companies, such as those backed by Baronsmead VCT 4, are seen by most 
commentators to be an important element in economic rejuvenation. There is a 
solid platform within our portfolio companies for further growth and we have 
the funds to invest. 
 
 
 
Robert Owen 
 
Chairman 
 
12 August 2010 
 
 
 
 
Table of Investments and Realisations 
 
 
 
Investments in the six months to 30 June 2010 
 
 
 
Number Company                              Location    Nature of business     Activity                        Book cost 
                                                                                                               GBP'000 
 
       Unquoted investments 
       New 
 
1      Getting Personal Limited             Manchester  Consumer Markets       On-line retail of               988 
                                                                               personalised gifts 
 
2      Inspired Thinking Group Limited      Birmingham  Business Services      Marketing services &            796 
                                                                               work flow systems 
 
3      Surgi C Limited                      Birmingham  Healthcare & Education Distribution of spinal implants 1,102 
 
       Follow on 
 
1      Independent Living Services Limited  Alloa       Healthcare & Education Care at home services           122 
 
2      Nexus Vehicle Holdings Limited       Pudsey      Business Services      Vehicle rental provider         499 
                                                                               to corporates 
 
       Paper consideration 
 
1      Crew Clothing Company Limited*       London      Consumer Markets       Branded clothing retailer       51 
 
2      Independent Living Services Limited* Alloa       Healthcare & Education Care at home services           150 
 
Total Unquoted investments                                                                                     3,708 
 
     AIM-traded & listed investments 
     New 
 
 1   Bglobal plc                            Darwen      Business Services      Smart metering                  176 
 
 2   Strategic Thought Group plc            Maidenhead  IT & Media             Risk management software        35 
 
     Follow on 
 
 1   Electric Word plc                      London      IT & Media             Business to business publisher  31 
 
 2   Green Compliance plc                   Cirencester Business Services      Small business compliance       156 
 
 3   Jelf Group plc                         Bristol     Financial Services     Financial solutions consultancy 210 
 
 4   Proactis Holdings plc                  Wetherby    IT & Media             Procurement software            219 
 
 5   Tasty plc                              London      Consumer Markets       Restaurant operator             114 
 
Total AIM-traded & listed investments                                                                          941 
 
Total investments in the period                                                                                4,649 
 
 
 
 
* Paper consideration from rolled up interest reinvested. 
 
 
 
 
 
 
Realisations in the six months to 30 June 2010 
 
 
 
Number Company                                   First      31 December Realised      Overall multiple 
                                                 investment 2009        profit/(loss) return* 
                                                 date       valuation   this period 
                                                            GBP'000       GBP'000 
 
       Unquoted realisations 
 
1      Active Assistance              Trade sale Mar 08     1,155       414           2.8 
 
2      Occam DM Ltd                   Trade sale Jul 04     90          255           1.5 
 
       Total Unquoted realisations                          1,245       669 
 
       AIM-traded & listed realisations 
 
1      Character Group plc            Trade sale Feb 08     88          44            0.9 
 
2      INVU plc                       Trade sale May 07     2           (1)           - 
 
3      Inverness Medical Inc.         Part sale  Aug 09     28          0             1.3 
 
4      Advanced Computer Software plc Part sale  Jul 08     540         13            2.1 
 
                                                            658         56 
 
       Written off 
 
1      Payzone plc                               May 03     0           0             - 
 
                                                            0           0 
 
Total AIM-traded & listed realisations                      658         56| 
 
Total realisations in the period                            1,903       725 
 
 
 
 
*  Includes interest/dividends received, loan note redemptions and partial 
realisations accounted for in prior periods. 
 
| Proceeds of GBP6,000 were also received in respect of an investment which had 
been written off in a prior period. 
 
 
 
Investment Portfolio 
 
 
 
By Sector* 
 
 
 
Business Services                                            38% 
 
Consumer Markets                                             18% 
 
Financial Services                                            5% 
 
Healthcare & Education                                        9% 
 
IT & Media                                                   30% 
 
 
 
 
 
Total Assets* 
 
 
 
Unquoted - loan stock                                        37% 
 
Unquoted - ordinary and preference shares                    15% 
 
AIM & Listed                                                 17% 
 
Fixed interest                                               27% 
 
Net current assets                                            4% 
 
 
 
 
 
Time Investments Held* 
 
 
 
Less than 1 year                                             11% 
 
Between 1 and 3 years                                        28% 
 
Between 3 and 5 years                                        49% 
 
Greater than 5 years                                         12% 
 
 
 
* at 30 June 2010 valuation 
 
 
 
 
 
 
 
 
Company                                 Nature of business       Book         31   30 June   % of      % of   % of 
                                                               cost GBP December        2010    Net Equity held Equity 
                                                                 '000     2009   valuation Assets        by     held 
                                                                      valuation      GBP'000        Baronsmead     by 
                                                                          GBP'000|                    VCT 4 plc    all 
                                                                                                              funds* 
 
Unquoted 
 
Nexus Vehicle Holdings Limited          Business Services       2,367      2,511     3,975    7.0        12.6   57.4 
 
Reed & Mackay Limited                   Business Services       1,211      3,145     3,697    6.5         9.5   40.0 
 
Crew Clothing Company Limited           Consumer Markets          983      1,300     1,962    3.5         5.7   24.1 
 
Quantix Limited                         IT & Media              1,193      1,862     1,886    3.3        11.4   48.0 
 
CableCom Networking Holdings Limited    IT & Media              1,381      1,848     1,854    3.3        10.6   48.0 
 
Fisher Outdoor Leisure Holdings Limited Consumer Markets        1,423      1,777     1,777    3.1        10.5   44.0 
 
CSC (World) Limited                     IT & Media              1,606      1,250     1,687    3.0         8.8   40.0 
 
Carnell Contractors                     Business Services       1,499      2,639     1,663    2.9         8.3   37.5 
 
Independent Living Services Limitied    Healthcare & Education  1,073      1,566     1,637    2.9        16.2   68.1 
 
Kafevend Holdings Limited               Consumer Markets        1,252      1,445     1,582    2.8        15.8   66.5 
 
Credit Solutions Limited                Financial Services      1,032      1,127     1,128    2.0         8.6   35.0 
 
MLS Limited                             IT & Media                781      1,138     1,126    2.0         5.3   22.5 
 
Surgi C Limited                         Healthcare & Education  1,102          -     1,102    1.9         9.8   42.5 
 
Playforce Holdings Limited              Business Services       1,033      1,106     1,039    1.8         9.7   44.0 
 
Getting Personal Limited                Consumer Markets          988          -       988    1.8         8.3   37.5 
 
Inspired Thinking Group Limited         Business Services         796          -       796    1.4         5.0   22.5 
 
Empire World Trade Limited              Business Services       1,296        658       707    1.2           |      | 
 
TVC Group Limited                       IT & Media              1,233        341       602    1.1        13.0   59.3 
 
Total Unquoted                                                 22,249     23,713    29,208   51.5 
 
AIM 
 
IDOX plc                                IT & Media                738        863       926    1.6         2.5    9.7 
 
Green Compliance plc                    Business Services         406        500       750    1.3         2.6   14.4 
 
WIN plc                                 IT & Media                397        367       597    1.1         4.2   19.0 
 
Advanced Computer Software plc          IT & Media                263      1,081       564    1.0         0.4    2.2 
 
Brulines Group plc                      Business Services         646        715       564    1.0         1.8    9.6 
 
Proactis Holdings plc                   IT & Media                619        307       477    0.8         5.4   26.5 
 
Jelf Group plc                          Financial Services        727        220       448    0.8         1.4    6.3 
 
Begbies Traynor Group plc               Financial Services        217        569       308    0.6         0.6    2.5 
 
Electric Word plc                       IT & Media                284        257       304    0.5         3.2   22.3 
 
InterQuest Group plc                    Business Services         310        259       304    0.5         1.8    7.2 
 
Mount Engineering plc                   Business Services         385        275       303    0.5         2.3   13.4 
 
Tasty plc                               Consumer Markets          469        161       291    0.5         2.5   17.1 
 
Kiotech International plc               Healthcare & Education    275        298       275    0.5         2.2   15.8 
 
Ffastfill plc                           IT & Media                251        297       260    0.5         0.9    6.5 
 
Craneware plc                           IT & Media                 71        184       223    0.4         0.2    1.1 
 
IS Pharma plc                           Healthcare & Education    246        239       198    0.4         1.0    5.9 
 
EG Solutions plc                        IT & Media                375        101       172    0.3         3.1   14.2 
 
Sanderson Group plc                     IT & Media                387        132       170    0.3         1.8    6.9 
 
Adventis Group plc                      IT & Media                291        223       161    0.3         2.6   20.7 
 
Bglobal plc                             Business Services         176          -       158    0.3         0.5    2.7 
 
Driver Group plc                        Business Services         438        294       156    0.3         2.3   10.4 
 
Praesepe plc                            Consumer Markets          525        185       155    0.3         0.7    3.8 
 
 
 
 
|  The total investment valuation at 31 December 2009 per the table above does 
not agree to the audited accounts due to purchases and sales since that date. 
 
* All funds managed by the same investment manager, ISIS EP LLP including 
Baronsmead VCT 4. 
 
| Following a restructuring, the effective ownership percentage is dependent on 
final exit proceeds. 
 
 
 
 
 
 
Company        Nature of  Book   31        30 June   % of   % of       % of 
               business   cost GBP DecemBer  2010      Net    Equity     Equity 
                          '000   2009      valuation Assets held by    held by 
                                 valuation GBP'000            Baronsmead all 
                                 GBP'000|                     VCT 4 plc  funds* 
 
AIM 
(continued) 
 
Plastics       Business      473       184       142    0.3        1.8     10.0 
Capital plc    Services 
 
Dods (Group)   IT & Media    313        91       125    0.2        0.8      4.4 
plc 
 
Autoclenz      Business      400       122       122    0.2        3.1     12.3 
Holdings plc   Services 
 
Cohort plc     Business      179       138       118    0.2        0.3      1.4 
               Services 
 
Quadnetics     Business      185       101       101    0.2        0.4      2.1 
Group plc      Services 
 
Prologic plc   IT & Media    233        93        78    0.1        3.1     15.0 
 
Brainjuicer    IT & Media     50        59        73    0.1        0.4      1.9 
Group plc 
 
Real Good Food Consumer      340        11        72    0.1        0.4      2.3 
Company (The)  Markets 
plc 
 
Marwyn Value   Financial      64        62        60    0.1        1.5      6.9 
Investors plc  Services 
 
STM Group plc  Financial     140        58        49    0.1        0.5      3.8 
               Services 
 
Clarity        IT & Media     50        40        46    0.1        0.3      6.2 
Commerce 
Solutions plc 
 
Tangent        Business      180        73        45    0.1        0.8      4.7 
Communications Services 
plc 
 
Strategic      IT & Media     35         -        35    0.1        0.4      2.1 
Thought Group 
plc 
 
Independent    IT & Media     15        19        23    0.0        0.1      0.1 
Media 
Distribution 
plc 
 
Zoo Digital    IT & Media    233         7        12    0.0        0.1      0.9 
Group plc 
 
Mission        IT & Media    143        26        10    0.0        0.1      0.7 
Marketing 
Group (The) 
plc 
 
Total AIM                 11,529     8,611     8,875   15.7 
 
Listed 
 
Chime          IT & Media    369       372       302    0.5        0.2      1.5 
Communications 
plc 
 
Vectura Group  Healthcare    245       383       228    0.4        0.2      1.3 
plc            & 
               Education 
 
Total Listed                 614       755       530    0.9 
 
 
New York Stock 
Exchange 
 
Inverness      Healthcare    157       224       136    0.2        0.0      0.0 
Medical Inc.   & 
               Education 
 
Total New York               157       224       136    0.2 
Stock Exchange 
 
Interest 
bearing 
securities 
 
UK T-Bill 05/              9,497         -     9,497   16.8 
07/10 
 
UK T-Bill 06/              5,995         -     5,995   10.6 
09/10 
 
Total interest            15,492         -    15,492   27.4 
bearing 
securities 
 
                          50,041    33,303    54,241   95.7 
Total 
investments 
 
Net current                                    2,421    4.3 
assets 
 
Net assets                                    56,662  100.0 
 
 
 
 
 
 
| The total investment valuation at 31 December 2009 per the table above does 
not agree to the audited accounts due to purchases and sales since that date. 
 
*  All funds managed by the same investment manager, ISIS EP LLP including 
Baronsmead VCT 4. 
 
 
 
 
 
AIM, Listed and NYSE Portfolio Concentration Analysis at 30 June 2010 
 
Investment ranking                          % of 
by valuation       Book cost Valuation    Quoted 
                       GBP'000     GBP'000 Portfolio 
 
Top Ten                4,607     5,242      54.9 
 
11-20                  3,073     2,422      25.4 
 
21-30                  3,137     1,374      14.4 
 
30+                    1,483       503       5.3 
 
Total                 12,300     9,541     100.0 
 
 
 
 
 
Independent Review Report to Baronsmead VCT 4 plc 
 
 
 
Introduction 
 
 
 
We have been engaged by the Company to review the condensed set of financial 
statements in the half-yearly financial report for the six months ended 30 June 
2010 which comprises the Income Statement, Reconciliation of Movement in 
Shareholders' Funds, Balance Sheet and Statement of Cash Flows and the related 
explanatory notes. We have read the other information contained in the 
half-yearly financial report and considered whether it contains any apparent 
misstatements or material inconsistencies with the information in the condensed 
set of financial statements. 
 
 
 
This report is made solely to the Company in accordance with the terms of our 
engagement to assist the Company in meeting the requirements of the Disclosure 
and Transparency Rules ("the DTR") of the UK's Financial Services Authority 
("the UK FSA"). Our review has been undertaken so that we might state to the 
Company those matters we are required to state to it in this report and for no 
other purpose. To the fullest extent permitted by law, we do not accept or 
assume responsibility to anyone other than the Company for our review work, for 
this report, or for the conclusions we have reached. 
 
 
 
Directors' responsibilities 
 
 
 
The half-yearly financial report is the responsibility of, and has been 
approved by, the Directors. The Directors are responsible for preparing the 
half-yearly financial report in accordance with the DTR of the UK FSA. 
 
 
 
As disclosed in note 1, the annual financial statements of the Company are 
prepared in accordance with UK Accounting Standards and applicable law (UK 
Generally Accepted Accounting Practice). The condensed set of financial 
statements included in this half-yearly financial report has been prepared in 
accordance with the Statement Half-Yearly Financial Reports as issued by the UK 
Accounting Standards Board. 
 
 
 
Our responsibility 
 
 
 
Our responsibility is to express to the Company a conclusion on the condensed 
set of financial statements in the half-yearly financial report based on our 
review. 
 
 
 
Scope of review 
 
 
 
We conducted our review in accordance with International Standard on Review 
Engagements (UK and Ireland) 2410 Review of Interim Financial Information 
Performed by the Independent Auditor of the Entity issued by the Auditing 
Practices Board for use in the UK. A review of interim financial information 
consists of making enquiries, primarily of persons responsible for financial 
and accounting matters, and applying analytical and other review procedures. A 
review is substantially less in scope than an audit conducted in accordance 
with International Standards on Auditing (UK and Ireland) and consequently does 
not enable us to obtain assurance that we would become aware of all significant 
matters that might be identified in an audit. Accordingly, we do not express an 
audit opinion. 
 
 
 
Conclusion 
 
 
 
Based on our review, nothing has come to our attention that causes us to 
believe that the condensed set of financial statements in the half-yearly 
financial report for the six months ended 30 June 2010 is not prepared, in all 
material respects, in accordance with the Statement Half-Yearly Financial 
Reports as issued by the UK Accounting Standards Board and the DTR of the UK 
FSA. 
 
 
 
Simon Pashby 
 
for and on behalf of KPMG Audit Plc Chartered Accountants, Edinburgh 
 
 
12 August 2010 
 
 
Responsibility statement of the Directors in respect of the half-yearly 
financial report 
 
 
 
We confirm that to the best of our knowledge: 
 
 
 
the condensed set of financial statements has been prepared in accordance with 
the Statement 'Half-yearly financial reports' issued by the UK Accounting 
Standards Board; 
 
 
 
the Chairman's Statement (constituting the interim management report) includes 
a fair review of the information required by DTR 4.2.7R of the Disclosure and 
Transparency Rules, being an indication of important events that have occurred 
during the first six months of the financial year and their impact on the 
condensed set of financial statements; 
 
 
 
the Statement of Principal Risks and Uncertainties below is a fair review of 
the information required by DTR 4.2.7R being a description of the principal 
risks and uncertainties for the remaining six months of the year; and 
 
 
 
the financial statements include a fair review of the information required by 
DTR 4.2.8R of the Disclosure and Transparency Rules, being related party 
transactions that have taken place in the first six months of the current 
financial year and that have materially affected the financial position or 
performance of the entity during that period; and any changes in the related 
party transactions described in the last annual report that could do so. 
 
 
 
By Order of the Board, 
 
 
 
R Owen 
 
 
Chairman 
 
 
12 August 2010 
 
 
 
 
Unaudited Income Statement 
 
For the six months to 30 June 2010 
 
 
 
                                       Six months to 30 June 2010 Six months to 30 June 2009  Year to 31 December 2009* 
 
                                         Revenue   Capital  Total   Revenue   Capital  Total  Revenue  Capital    Total 
                                           GBP'000     GBP'000  GBP'000     GBP'000     GBP'000  GBP'000    GBP'000    GBP'000    GBP'000 
 
Unrealised gains on investments                -     1,366  1,366         -     1,849  1,849        -    2,460    2,460 
 
Realised gains/(losses) on investments         -       731    731         -      (42)   (42)        -    1,339    1,339 
 
Income                                     1,179         -  1,179       563         -    563    1,322        -    1,322 
 
Recoverable VAT                                -         -      -         1       (3)    (2)        1      (3)      (2) 
 
Investment management fee                  (167)     (502)  (669)     (151)     (454)  (605)    (301)    (903)  (1,204) 
 
Other expenses                             (167)         -  (167)     (174)         -  (174)    (393)        -    (393) 
 
Profit on ordinary activities 
before taxation                              845     1,595  2,440       239     1,350  1,589      629    2,893    3,522 
 
Taxation on ordinary activities            (210)       210      -      (34)        34      -    (123)      123        - 
 
Profit on ordinary activities 
after taxation                               635     1,805  2,440       205     1,384  1,589      506    3,016    3,522 
 
Return per share: 
Basic                                      1.11p     3.17p  4.28p     0.39p     2.64p  3.03p    0.97p    5.77p    6.74p 
 
 
 
 
*These figures are audited. 
 
 
 
Unaudited Reconciliation of Movement in Shareholders' Funds 
 
For the six months to 30 June 2010 
 
 
 
                                                 Six months  to 30 June  2010  Six months  to 30 June  2009     Year to 
                                                                         GBP'000                        GBP'000 31 December 
                                                                                                                   2009 
                                                                                                                 GBP'000* 
 
Opening shareholders' funds                                             47,216                       47,896      47,896 
 
Profit for the period                                                    2,440                        1,589       3,522 
 
Issue of shares                                                          8,165                          601         602 
 
Expenses of share issue & buy backs for treasury                         (443)                         (42)        (48) 
 
Purchase of shares for treasury                                          (716)                      (1,111)     (1,109) 
 
Dividends paid                                                               -                            -     (3,647) 
 
Closing shareholders' funds                                             56,662                       48,933      47,216 
 
 
 
 
*These figures are audited. 
 
 
 
 
Notes 
 
The unaudited interim results which cover the six months to 30 June 2010 have 
been prepared in accordance with applicable accounting standards and adopting 
the accounting policies set out in the statutory accounts of the Company for 
the period to 31 December 2009. 
 
Return per ordinary share is based on a weighted average of 57,060,828 ordinary 
shares in issue (30 June 2009 - 52,515,200, 31 December 2009 - 52,305,453). 
 
Earnings for the six months to 30 June 2010 should not be taken as a guide to 
the results of the full financial year to 31 December 2010. 
 
During the six months to 30 June 2010 the Company issued, pursuant to the offer 
for subscription, 6,012,140 ordinary shares at an offer price of 95.5p per 
share and 2,497,970 ordinary shares at an offer price of 97.0p which raised GBP 
8,165,000, before costs. During this period the Company purchased 875,000 
ordinary shares to be held in Treasury at a cost of GBP716,000. At 30 June 2010 
the Company holds 4,668,593 ordinary shares in Treasury. Excluding Treasury 
shares, there were 59,734,236 ordinary shares in issue at 30 June 2010 (30 June 
2009 - 52,099,126 ,31 December 2009 - 52,099,126). 
 
The interim dividend of 3.0p per ordinary share (1.0p revenue and 2.0p capital) 
will be paid on 15 September 2010 to shareholders on the register on 20 August 
2010. The ex-dividend date is 18 August 2010. 
 
The financial information contained in this Half-yearly Report does not 
constitute statutory accounts as defined in Section 434 of the Companies Act 
2006. The information for the year to 31 December 2009 has been extracted from 
the latest published audited financial statements. The audited financial 
statements for the year to 31 December 2009, which were unqualified, have been 
filed with the Registrar of Companies. No statutory accounts in respect of any 
period after 31 December 2009 have been reported on by the Company's auditors 
or delivered to the Registrar of Companies. 
 
Copies of the Half-yearly Report have been mailed to shareholders and are 
available from the Registered Office of the Company at 100 Wood Street, London 
EC2V 7AN. 
 
 
 
 
 
 
 
 
Unaudited Balance Sheet 
 
As at 30 June 2010 
 
 
 
                                                  As at   As at       As at 
                                                30 June 30 June 31 December 
                                                   2010    2009        2009 
                                                  GBP'000   GBP'000      GBP'000* 
 
Fixed assets 
 
Unquoted investments                             29,208  27,055      24,958 
 
Traded on AIM & Listed (include NYSE)             9,541   9,350       9,680 
 
Interest bearing securities                      15,492  10,300      10,496 
 
                                                 54,241  46,705      45,134 
 
Current assets 
 
Debtors                                             249     217         342 
 
Cash at bank and on deposit                       2,630   2,439       2,169 
 
                                                  2,879   2,656       2,511 
 
Creditors (amounts falling due within one year)   (458)   (428)       (429) 
 
Net current assets                                2,421   2,228       2,082 
 
Total assets less current liabilities            56,662  48,933      47,216 
 
Net assets                                       56,662  48,933      47,216 
 
Capital and reserves 
 
Called-up share capital                           6,440   5,589       5,589 
 
Share premium account                            21,192  14,323      14,318 
 
Capital redemption reserve                        8,622   8,622       8,622 
 
Revaluation reserve                               4,200   2,902       3,156 
 
Capital reserve                                  15,800  17,437      15,759 
 
Revenue reserve                                     408      60       (228) 
 
Equity shareholders' funds                       56,662  48,933      47,216 
 
 
 
 
*These figures are audited. 
 
 
 
 
 
                                                As at      As at       As at 
                                              30 June    30 June 31 December 
                                                 2010       2009       2009* 
 
Net asset value per share                      94.86p     93.92p      90.63p 
 
Number of ordinary shares in issue         59,734,236 52,099,126  52,099,126 
 
Treasury net asset value per share             94.02p     93.25p      89.92p 
 
Number of ordinary shares in issue         59,734,236 52,099,126  52,099,126 
 
Number of ordinary shares held in Treasury  4,668,593  3,793,593   3,793,593 
 
Number of listed ordinary shares           64,402,829 55,892,719  55,892,719 
 
 
 
 
*These figures are audited. 
 
 
 
 
 
 
 
 
 
 
 
Unaudited Statement of Cash Flows 
 
For the six months to 30 June 2010 
 
 
 
                                      Six months to Six months to    Year to 31 
                                       30 June 2010  30 June 2009 December 2009 
                                              GBP'000         GBP'000        GBP'000* 
 
Net cash inflow from operating                  259           722           527 
activities 
 
Capital expenditure and financial           (6,809)          (74)         3,506 
investment 
 
Equity dividends paid                             -             -       (3,647) 
 
Net cash (outflow)/inflow before            (6,550)           648           386 
financing 
 
Net cash inflow/(outflow) from                7,011         (561)         (569) 
financing 
 
Increase/(decrease) in cash                     461            87         (183) 
 
Reconciliation of net cash inflow/              461            87         (183) 
(outflow) to movement in net cash 
Increase/(decrease) in cash 
 
Opening net cash                              2,169         2,352         2,352 
 
Net cash at end of period                     2,630         2,439         2,169 
 
Reconciliation of operating profit 
before taxation to net cash flow from         2,440         1,589         3,522 
operating activities 
Profit on ordinary activities before 
taxation 
 
Unrealised gains on investments             (1,366)       (1,849)       (2,460) 
 
Realised (gains)/losses on                    (731)            42       (1,339) 
investments 
 
Changes in working capital and other           (84)           940           804 
non-cash items 
 
Net cash inflow from operating                  259           722           527 
activities 
 
 
 
 
 
 
*These figures are audited. 
 
 
 
Principal Risks and Uncertainties 
 
 
 
The Company's assets consist of equity and fixed 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 Venture Capital Trust, investment and strategic, regulatory, 
reputational, operational and financial risks. These risks, and the way in 
which they are managed, are described in more detail under the heading 
Principal risks, risk management and regulatory environment within the Business 
Review and Notes in the Company's Annual Report and Accounts for the year to 31 
December 2009. The Company's principal risks and uncertainties have not changed 
materially since the date of that report. 
 
 
 
Related Parties 
 
 
 
ISIS EP LLP ('the Manager') manages the investments of the Company. The Manager 
also provides or procures the provision of secretarial, accounting, 
administrative and custodian services to the Company. Under the management 
agreement, the Manager receives a fee of 2.5 per cent per annum of the net 
assets of the Company. This is described in more detail under the heading 
Management within the Report of the Directors in the Company's Annual Report 
and Accounts for the year to 31 December 2009. During the period, the Company 
has incurred management fees of GBP669,000 and secretarial and accounting fees of 
GBP55,000 payable to the Manager. 
 
 
 
Going Concern 
 
 
 
After making enquires, and bearing in mind the nature of the Company's business 
and assets, the Directors consider that the Company has adequate resources to 
continue in operational existence for the foreseeable future. In arriving at 
this conclusion the Directors have considered the liquidity of the Company and 
its ability to meet obligations as they fall due for a period of at least 
twelve months from the date that these financial statements were approved. As 
at 30 June 2010 the Company held cash balances & investments in UK Gilts with a 
combined value of GBP18,122,000. Cash flow projections have been reviewed and 
show that the Company has sufficient funds to meet both its contracted 
expenditure and its discretionary cash outflows in the form of the share 
buyback programme and dividend policy. The Company has no external loan finance 
in place and therefore is not exposed to any gearing covenants. 
 
 
SHAREHOLDER INFORMATION AND CONTACT DETAILS 
 
 
 
Enquiries 
 
 
 
Shareholders should contact the following regarding queries: 
Basic contact details, ie change of address, joining the DRIP queries re: share 
and tax certificates and bank mandate forms: Computershare (Company Registrar) 
 
 
 
www-uk.computershare.com/investor 
 
 
 
Investors who hold ordinary shares in their own name can check their holdings 
on our Registrar's website 
www-uk.computershare.com. Please note that to access this facility investors 
will need to quote the reference number shown on their share certificate. 
 
 
 
Alternatively, by registering for the Investors' Centre facility on 
Computershare's website, investors can view details of all their holdings for 
which Computershare is Registrar, as well as access additional facilities and 
documentation. Please see www.investorcentre.co.uk for further information. 
 
 
 
Shareholder Helpline 
 
 
 
Tel: 0870 703 0137 (Calls charged at national rate). 
The Shareholder Helpline is available on UK business days between Monday and 
Friday, 8.30 am to 5 pm. The helpline contains automated self-service 
functionality which is available 24 hours a day, 7 days a week. Using your 
Shareholder Reference Number which is available on your share certificate or 
dividend tax voucher, our self-service functionality will enable you achieve 
the following things: 
 
 
 
 
 
Automated Functions 
 
 
 
-    confirm the latest share price 
 
-    confirm your current share holding balance 
 
-    confirm payment history 
 
-    order a Change of Address, Dividend Bank Mandate or Stock Transfer Form 
 
 
 
e-mail: web.queries@computershare.co.uk 
 
 
 
For information on asset allocations, dividend policies, investment process, 
DRIP mechanism, share price movements, the share price discount and selling 
shares: 
 
 
 
ISIS EP LLP (the Investment Manager) at www.isisep.com 
 
 
 
e-mail: michael.probin@isisep.com; margaret.barff@isisep.com 
 
 
 
Tel: Michael Probin 020 7506 5796; Margaret Barff 020 7506 5630. 
 
 
 
The Baronsmead website (www.baronsmeadvcts.co.uk) links to helpful sites, 
contains details of the team and some case studies of investments. 
 
 
 
Share Price 
 
 
 
The Company's shares are listed on the London Stock Exchange. The mid-price of 
the Company's shares is given daily in the Financial Times in the Investment 
Companies section of the London Share Service. Share price information can also 
be obtained from many financial websites. 
 
 
 
Trading Shares 
 
 
 
The Company's shares can be bought and sold in the same way as any other quoted 
company on the London Stock Exchange via a stockbroker. 
 
 
 
The market makers in the shares of Baronsmead VCT 4 plc are: 
 
 
 
Matrix Corporate Capital (the Company's broker) 
 
020 3206 7000 
 
 
 
Singer Capital MarketS 
 
020 3205 7500 
 
 
 
Winterflood 
 
020 3400 0251 
 
 
Financial Calendar 
 
 
 
November 2010 - Quarterly fact sheet to 30 September 2010 
 
 
 
February 2011 - Results for year to 31 December 2010 announced and annual 
report and accounts sent to shareholders 
 
 
 
May 2011 - Annual General Meeting 
 
 
 
 
 
Corporate Information 
 
 
 
Directors 
 
 
 
Robert Owen (Chairman) 
Ian Kirkpatrick|* 
Alan Pedder CBE|? 
Robin Williams 
 
 
 
|    Chairman of the Nomination Committee 
 
*     Chairman of the Audit & Risk Committee 
 
|    Chairman of the Management Engagement and Remuneration Committee 
 
?    Senior Independent Director 
 
 
 
Secretary 
 
 
 
Barry Lawson LLB, Solicitor 
 
 
 
Registered Office 
 
 
 
100 Wood Street 
London EC2V 7AN 
 
 
 
Investment Manager 
 
 
 
ISIS EP LLP 
100 Wood Street 
London EC2V 7AN 
 
 
 
Investor Relations 
 
 
 
Michael Probin 
020 7506 5796 
 
 
 
Registered Number 
 
 
 
04313537 
 
 
 
Registrars and Transfer Office 
 
 
 
Computershare Investor Services PLC 
PO Box 82 
The Pavilions 
Bridgwater Road 
Bristol BS99 6ZZ 
Tel: 0870 703 0137 
 
 
 
Brokers 
 
 
 
Matrix Corporate Capital LLP 
One Vine Street 
London W1J 0AH 
 
 
 
 
 
 
Auditors 
 
 
 
KPMG Audit Plc 
Saltire Court 
20 Castle Terrace 
Edinburgh EH1 2EG 
 
 
 
Solicitors 
 
 
 
Norton Rose 
3 More London Riverside 
London SE1 2AQ 
 
 
 
VCT Status Adviser 
 
 
 
PricewaterhouseCoopers LLP 
1 Embankment Place 
London WC2N 6RH 
 
 
 
Website 
 
 
 
www.baronsmeadvct4.co.uk 
 
 
 
Additional Information 
 
 
 
The information provided in this report has been produced in order for 
shareholders to be informed of the activities of the Company during the period 
it covers. ISIS EP LLP does not give investment advice and the naming of 
companies in this report is not a recommendation to deal in them. 
 
 
 
Baronsmead VCT 4 plc is managed by ISIS EP LLP which is Authorised and 
regulated by the FSA. Past performance is not necessarily a guide to future 
performance. Stock markets and currency movements may cause the value of 
investments and the income from them to fall as well as rise and investors may 
not get back the amount they originally invested. Where investments are made in 
unquoted securities and smaller companies, their potential volatility may 
increase the  risk to the value of, and the income from, the investment. 
 
 
 
END