Pembroke VCT is now open to new applications
Deadline for next allotment: 27th September 2023
Next allotment date: 29th September 2023
We are taking new applications
Apply OnlineDownload our 2023/24 prospectus
DownloadChairman’s Letter
Dear Investor
I am pleased to announce that Pembroke VCT plc has launched a new share offer to raise up to £60 million.
The Board is pleased to report a strong performance in the year despite the extended challenges of COVID-19 and the inflationary pressures in the UK.
After raising over £229 million since 2012 and returning £52m to Shareholders, Pembroke has invested in 64 companies.Since April 2022, the Company has invested £11 million across six new exciting and innovative businesses, and £18 million in 15 existing portfolio companies.
As the Company continues its growth beyond the £200 million net asset hurdle it remains in a strong position and the additional cash will allow it to take advantage of high-quality new investment opportunities as well as supporting the continued growth of its existing portfolio businesses.
As at 30 June 2023 the (unaudited) net asset value of the B Ordinary Shares was 112.7 pence and the (unaudited) Total Return per B Ordinary Share was 145.2 pence.
Jonathan Djanogly
Chairman
5 September 2023
The VCT has had three exits since January 2021: Pasta Evangelists (January 2021), PLENISH (May 2021) and ME+EM (March 2022).
New Investors will gain immediate access to a maturing portfolio of growing businesses and to a well-established dividend paying VCT. These assets include high growth opportunities such as Lyma, Secret Food Tours, OnePlan and Peckwater Brands. Pembroke intends to use the funds raised to make a number of new and follow-on investments in companies in which the
Company has already invested – where further capital will accelerate their growth plans.
Changes brought about to the VCT Rules in 2015 and 2018 restrict the types of companies that VCTs can invest in. Many VCT managers have been forced to develop new investment capabilities and hire new staff. Given the Company’s focus on providing development capital to high-growth companies rather than ‘management buy-out’ transactions and mature businesses, the Board is confident that the Manager remains well placed to manage the Company and identify suitable investment opportunities. Neither the Company’s investment strategy nor the types of companies it invests in has had to alter since these
rule changes.
Investments made following the Finance Act 2018 are subject to the risk-to-capital condition, which has two requirements, based on the views of a ‘reasonable’ person: (i) does the company intend to grow and develop over the long term, and (ii) is there the risk of a loss of capital to the investor of an amount greater than the net return. The Company believes its current portfolio and future pipeline meets these tests without difficulty, and will not need to make any meaningful changes to its investment strategy.
The Company’s objective is to provide Investors with access to a series of carefully researched investments currently focusing on its three key investment segments being: Consumer, Technology and Business Services. Pembroke will continue to invest in a diversified portfolio of smaller unquoted companies, although it may also invest in companies whose shares are traded on AIM or the Aquis Stock Exchange, with the objective of generating significant returns, whilst enabling Investors to benefit from substantial tax advantages.
Pembroke seeks opportunities which are capable of significant organic growth and sustainable cash generation. A key feature of this strategy is an investment bias towards early stage and founder-led businesses.
- Tax-free dividends
- We target an annual 5p per share dividend (increased in 2022 from 3p per share)
- Special dividends are paid on exits
- 7.0p per share paid in FY22 & 5.0p per share paid in FY23
- 2.5p per share paid in May 2023 and a further 2.5p annouced in August 2023
- The flexible dividend reinvestment scheme allows shareholders to choose cash or to re-invest; for each dividend.
VCTs offer significant tax benefits over most investment products, including:
- Income tax relief of 30% on the amount invested;
- Dividend payments are tax free; and
- No capital gain arises when Shares are sold.
