Calculus VCT Plc  (the 'Company')

Interim results for the six months ended 31 August 2022 (unaudited)

For the full half yearly unaudited financial report, please refer to the Investor Information section on https://www.calculuscapital.com/calculus-vct/

As expected, following the dividend of 3.06 pence per share paid in July 2022, the NAV was adjusted by the same margin. However, some positive performance in the qualifying portfolio meant that there was some uplift to the NAV to 64.91 pence per share at the reporting date.

Total return by shareholder cohort

*     Weighted average in respect of each year

**   Total Return is equal to the sum of NAV at 31 August 2022 and cumulative dividends received, divided by the average issue price

*** Total Return on net investment is equal to the sum of NAV at 31 August 2022 and cumulative dividends received, divided by the average issue price less 30% tax relief

CHAIRMAN'S UPDATE

I am pleased to present your Company's results for the 6 months to 31 August 2022.

Performance summary

The war in Ukraine and resultant energy crisis have dominated the news in the six months to 31 August 2022. The portfolio has managed to gain value in the period despite these challenges, in part because the Company has few investments in the most 'at risk' sectors such as industrials and manufacturing.

The Company is pleased to announce the successful exit of Park Street Shipping in the period. In October 2021, Park Street Shipping sold its only asset, the MV Nordic London - a 2010 South Korean built, 35,000 deadweight Handysize ship, providing an overall return of 1.8x. The sale of the ship was the initial step of the exit process. In order to distribute the proceeds, the company entered Member Voluntary Liquidation on 1st April 2022 and on 5 August 2022, shareholders including Calculus VCT received 92% of the proceeds with the remainder being held by the liquidator until the liquidation has been completed.

Despite the ongoing economic challenges, the Board is pleased with the performance of the Company's portfolio and the positive uplifts in the valuations of some portfolio companies. The most significant movement in the qualifying portfolio on the upside was Wazoku which increased the NAV by £0.3m. The company has shown strong growth and in September 2022 raised £8.3m to develop its software and strengthen its team.

Another strong performer has been Oxford Biotherapeutics ("OBT") which has added £0.3m of value to the NAV in the period to 31 August 2022. In June 2022, the company announced a multi-year collaboration with Immunogen, receiving an upfront payment and is eligible to receive milestone payments and tiered royalties. 

Home Team Content, a UK-based independent production company enjoyed an uplift in share value since February 2022, improving the NAV by £0.2m. The company has been making strong progress on its slate and has a range of film and TV projects at the pre-production stage.

The AIM quoted holdings have been affected by the economic climate, collectively losing £0.6m of value from the NAV since the year end. It is our view that this value will be regained when the global economic and political situation stabilises and markets can recover.

Other than the quoted holdings, the only portfolio company to lose value in the period was Arcis Biotechnology Holdings. The company has been facing trading issues for some time and went into administration in August 2022.

In the period to 31 August 2022, four new investments and four follow-on investments were made on behalf of the qualifying portfolio:

New Investments

Follow-on Investments

We believe the portfolio is well positioned to continue to provide long term growth to shareholders and that our Investment Manager is similarly positioned to exploit these opportunities.

Further information can be found on new investee companies Destiny Pharma PLC, Riff Raff Entertainment Limited, Notify Technology Limited and Optalitix Limited in the Investment Manager's Report.

Buybacks

During the period, the Company bought back and cancelled 846,270 Ordinary shares. The Company continues to review opportunities to carry out share buybacks at a discount of no greater than 5% to NAV.

Dividends

As mentioned above, a dividend was paid on 31 July 2022 of 3.06 pence per eligible Ordinary share.

Board composition

The board consist of four Directors, three of which are independent from the Manager.

Ordinary share issue

The offer for subscription for Ordinary Shares that opened on 13 September 2021 and closed on 26 August 2022 received aggregate subscriptions from the issue of Ordinary shares of £6.7 million. On 21 September 2022 a new prospectus was launched for a further offer for subscription for Ordinary Shares, with the shares to be issued in the 2022/23 and 2023/24 tax years.

I invested £5,000 under the offer that closed in August 2022 and had 7,077 shares allotted in June 2022. These shares were acquired on the same terms as the shares subscribed for by other investors in the offer.

Developments since the period end

As mentioned above. since the period end the Company has made a follow on investment of £300,000 in Wazoku to support the development of its software.

Future prospects

It is generally accepted that the UK is heading towards more challenging markets however the Board is optimistic that the portfolio's predominant exposure to B2B technology, healthcare, life sciences and entertainment sectors will mean the Company is shielded to some extent. Your Board continues to keep a watchful brief over developments and our Investment Manager is working closely with our portfolio companies. We maintain our cautious but optimistic outlook.

Jan Ward

Chairman, 18 October 2022