Capital for Colleagues lay out audited results

At listing, we raised GBP 2.19 million to implement our strategy to provide capital and practical assistance to existing and aspiring EOBs and to help them to become effective and profitable businesses, driven by the ethos of employee ownership. We are sector agnostic in terms of business activity and we structure the investments we make to reflect each investee company’s individual requirements and prospects. As a result, the funding we provide takes the form of debt, equity or convertible hybrid structures. Whatever structure we choose, the premise underlying all our investments is that they should facilitate the full engagement of employees in a business.

The Company’s progress since listing has been reflected in the rapid development of our investment portfolio, which has grown from interests in three EOBs to interests in more than 20, and our pipeline of opportunities is growing fast. The companies that we have invested in range from a supplier of civil engineering and construction materials, with depots in Penrith, Redruth and Sittingbourne, to an accountancy service provider in Stoke on Trent.

We continue to look for ways to enhance our business, both through our own initiatives as well as through the formation of strategic partnerships. In line with this, in September 2014, we co-founded a new, dedicated advisory business, C4C Ownership Partners, which provides specialist advice and support to EOBs or companies looking to become employee owned.

With this initiative, we were delighted to welcome Peter Matthews to the team. Peter, who is leading C4CO, has over 27 years’ experience in helping to establish an d manage consulting, advisory and investment management businesses, including over 14 years’ specialist experience in the EOB sector. He complements our highly experienced Board and team who understand the workings of the sector and the requirements of EOB companies.

As a result of this initiative, Capital for Colleagues can now provide a comprehensive service: advising clients on what needs to be done to become employee owned, managing the transition to employee owned status and providing the financial capital to achieve this.

Financial Results:

In the 11 months ended 31 August 2014, the Company invested GBP 2.29 million across a portfolio of eight unquoted EOBs and 12 publicly traded EOBs. The Company generated income of GBP 0.21m during the period and as at 31 August 2014 the Company had net assets of GBP 3.45 million, equating to a NAV per share of 48.2p, representing a 23% discount to the current share price.

The Directors do not recommend the payment of a dividend.

Outlook:

We remain focused on the continued expansion of our investment and advisory portfolio and on generating attractive returns for our shareholders as we build a leading position in the EOB sector. To this end, we have identified an extensive range of potential investee companies, in varying sectors and of various sizes, which we believe can deliver the returns we require. The Directors are confident that the EOB sector will continue to expand and that EOBs will continue to deliver robust performance as the UK economic recovery strengthens. Reflective of this, post period end, we made a further two investments, increasing our portfolio to ten unquoted EOBs, underpinning the Company’s active growth strategy.

Accordingly, we remain very positive about the opportunities to grow the business and believe that we are well placed to capitalise on the significant growth potential of the EOB sector. As a result, we are confident in our ability to create value for our shareholders and would like to thank them for their continued support.