BVP Bioscience Vct

Final Results for the Year Ended 31 December 2021

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE UK VERSION OF THE MARKET ABUSE REGULATION NO 596/2014 WHICH IS PART OF ENGLISH LAW BY VIRTUE OF THE EUROPEAN (WITHDRAWAL) ACT 2018, AS AMENDED. ON PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS INFORMATION IS CONSIDERED TO BE IN THE PUBLIC DOMAIN.

25 March 2022

Seneca Growth Capital VCT plc

Annual Report and Financial Statementsfor the year ended 31 December 2021

NAV Update

and

Notice of Annual General Meeting

The Directors are pleased to announce the audited results of the Company for the year ended 31 December 2021. A copy of the Annual Report and Financial Statements will be made available to shareholders shortly, and extracts are now set out below.

The Company’s AGM will be held at 10:00 a.m. on Wednesday, 27 April 2022 at the Company’s registered address 9 The Parks, Haydock, WA12 0JQ. A copy of the Notice of AGM and Annual Report and Accounts will be available on the Company’s website: www.senecavct.co.uk

Financial Headlines

B Shares
£5.7m	Amount raised during the year from the issue of B shares
£4.5m	Amount invested during the year into seven new investee companies by B share pool
109.1p	B share NAV plus cumulative dividends paid at 31 December 2021 (“Total Return”)
100.1p	B share NAV at 31 December 2021
3.0p	Interim dividends paid per B share during year
Ordinary Shares
108.2p	Ordinary share NAV plus cumulative dividends paid at 31 December 2021 (“Total Return”)
38.9p	Ordinary share NAV at 31 December 2021
4.0p	Interim capital dividends paid per Ordinary share during year

Financial Summary

	Year to 31 December 2021Ordinary share pool	Year to 31 December 2021 B share pool	Year to 31 December 2020Ordinary share pool	Year to 31 December 2020 B share pool
Net assets (£’000s)	3,157	14,606	2,453	8,317
Return on ordinary activities after tax (£’000s)	1,029	1,067	1,045	252
Earnings per share (p)	12.6	8.9	12.8	3.5
Net asset value per share (p)	38.9	100.1	30.2	91.8
Dividends paid since inception (p)	69.25	9.00	65.25	6.00
Total return (NAV plus cumulative dividends paid) (p)	108.15	109.10	95.45	97.80

Financial Calendar

The Company’s financial calendar is as follows:

27 April 2022                Annual General Meeting will be held at 10.00 a.m. at 9 The Parks, Haydock, WA12 0JQ

July 2022                Half-yearly results to 30 June 2022 published

March 2023                Annual results for the year to 31 December 2022 announced and Annual Report and Financial Statements published

For further information, please contact:

John Hustler, Seneca Growth Capital VCT Plc at john.hustler@btconnect.com

Richard Manley, Seneca Growth Capital VCT Plc at Richard.Manley@senecapartners.co.uk

Please note: page references in the extracts below refer to the page numbers in the Annual Report and Financial Statements.

Chairman’s Statement

I am pleased to present the 2021 Annual Report on behalf of the Board to shareholders.

Overview

The last year saw difficult trading conditions continuing to challenge UK businesses as the government sought to combat new and existing strains of Covid-19. Despite those challenges, I am pleased to report that both share pools have performed very well. The Total Return (NAV per share plus cumulative dividends per share) for each share class increased during the year with the B share increasing by 11.6% to 109.1p (2020: 1.8% to 97.8p) and the Ordinary share increasing by 13.3% to 108.2p (2020: 15.5% to 95.5p). Indeed, since the start of the Covid-19 pandemic in March 2020, we are pleased to report that the B share pool has seen a 37% increase in the NAV (inclusive of dividends paid) from 79.5p to 109.1p at 31 December 2021.        

I am also pleased to be able to report that Seneca continued the development of the B share pool during the year both in terms of fundraising and investment activity. In October 2021, the Company launched its fourth offer for B shares and has now raised £14.5 million following the recent allotment of £0.9 million of shares in December 2021. I would like to welcome all new shareholders and thank both existing and new shareholders for their support. The share offer will remain open until 26 October 2022 unless it reaches its total target of £20 million before then.

The Company made eight investments into seven new B share pool investee companies in the year in addition to achieving one full exit and three partial exits. As a result, the Company’s B share pool closed the year with sixteen investments valued at £8 million compared to ten investments valued at £4 million at 31 December 2020.

The Ordinary share pool made a partial realisation in the year from one of its two remaining AIM quoted investments. During the year, the Scancell share price remained generally up from the previous period close of 13.5p, ending the year at 19.5p as a result of positive progress made with various clinical trials. The Ordinary share pool was able to realise 1,000,000 shares at an average price of 21.7p per share during the year providing an average weighted return of 3.6x over original investment cost. Scancell accounts for 68% of the Ordinary share pool’s NAV at the year end.

Full details of the B share pool and Ordinary share pool portfolios are included in the Investment Manager’s Report on pages 14 to 33.

With 46% of the B share pool’s NAV as at 31 December 2021 represented by cash, the Company’s B share pool has ended the year well placed to take advantage of the growing number of AIM quoted and private company investment opportunities being reviewed by Seneca.

I have set out below the progress made by each of the Company’s share classes during the year.

B Share Pool

B Shares - Results

The key items to impact the NAV of the B share pool during the year were as follows:

• The full realisation of one B share pool unquoted investment generating a 1.8x return;
• The partial exit of three B share pool AIM quoted investments generating a weighted average return of 2.3x;
• An unrealised gain in investment values of £0.3 million in the period;
• Two dividends paid during the year totalling 3.0p per B share; and
• The Company’s running costs (capped at 3% of B share NAV).

The net result of the above was an overall increase in the Total Return per B share to 109.1p as at 31 December 2021 (2020: 97.8p). This represents a weighted average positive capital return of 10.6p per B share (2020: 5.7p) and a weighted average negative revenue return of 1.7p per B share (2020: negative 2.2p).

Whilst the negative revenue return of 1.7p per B share is principally a result of the impact of the Company’s running costs on the B share pool, shareholders will recall that the Company’s total running expenses are capped at 3% of the B share NAV. As a result, Seneca reduced its annual management fee for 2021 from £246k to £211k to ensure the Company’s annual running expenses stayed within this 3% limit. Since July 2021, the Company’s running costs are allocated pro-rata across both the B share pool and Ordinary share pool, capped at 3% of their respective NAVs.

The positive capital return of 10.6p per B share noted above was principally due to realisations made in the year, an overall increase in the carrying value of three of the B share pool’s unquoted investments and the net increase in the value of the AIM quoted portfolio, offset by a reduction in the carrying value of one of the B share pool’s unquoted company investments. Full details are disclosed in the Investment Manager’s Report on pages 14 to 33.

B Shares - Investment Portfolio Review

As at 31 December 2021, the B share portfolio comprised sixteen companies, nine of which are quoted on AIM, at a total net investment cost of £4,042k. As at 31 December 2021 the quoted portfolio was valued at £4,526k.

Throughout the period, the Company was able to make four full and partial exits from the B share pool at a weighted average return of 2.2x on original investment cost.

In February 2022, the Company made an additional investment of £500k into the IPO of Clean Power Hydrogen Plc (“CPH2”) from the B share pool, which was fully realised shortly thereafter for an average weighted return of 1.4x.

In March 2022, the Company made a further investment of £280k into the AIM quoted company Verici Dx Plc from the B share pool.

B Shares – Update and Outlook

Shareholders will be pleased to know the Board has declared an interim B share dividend of 1.5p per B share on 8 March 2022 to be paid on 20 May 2022 to shareholders on the B share register on 6 May 2022, with an ex-dividend date of 5 May 2022.

Notwithstanding the significant challenges faced by the UK economy since the onset of Covid-19 and the UK’s departure from the European Union, we are encouraged by the positive progress being made by the B share pool. Seneca continues to work closely with the investee companies in the B share portfolio and has seen the benefits of this work with the increase in the carrying values for three of the seven unquoted investee companies and remains confident that the portfolio retains its potential to provide attractive returns for B shareholders over the medium term.

The Board is pleased with the progress that Seneca has made since its appointment as Investment Manager in 2018, in terms of funds raised, new investments made and presence and reputation in the market, resulting in access to new quoted and unquoted opportunities and now, exits achieved.

Seneca expect to increase the funds raised under the current B share Offer and add new growth capital investments to the B share portfolio during the course of 2022 from, inter alia, the investments they currently have in the later stages of due diligence.

Ordinary Share Pool

Ordinary Shares - Results

The NAV per Ordinary share increased by 8.7p from 30.2p to 38.9p during the year and this was after the payment of the dividend per Ordinary share of 4.0p.

This increase was principally driven by the increase in value of the Ordinary share portfolio’s two AIM quoted investments during the year: Scancell and Arecor.

The quoted bid price of Scancell shares (the Ordinary share pool’s largest investment) increased from 13.5p to 19.5p during this period and so it was decided to harvest a modest portion of our shareholding. We now hold 11 million shares.

We were particularly encouraged that Arecor, a long-standing Ordinary share pool unquoted investee company, announced its intention to float on AIM in May 2021. We considered the terms of the fundraise to be attractive and in order to support the IPO the Ordinary share pool purchased a further 37,611 shares in Arecor at £2.26 per share. Following a share reorganisation prior to flotation, the Ordinary share pool’s existing shares were converted to 186,366 shares and the Ordinary share pool now holds a total of 223,977 shares in Arecor valued at £829k as at 31 December 2021 (compared to the original cost of £227k). We were pleased to be able to further support Arecor through investment in the B share portfolio.

As a result of the Scancell realisation noted above, your Board was very pleased to be able to pay a dividend of 4p per Ordinary share during the year with no material adverse impact on the Ordinary share pool’s NAV. The Total Return in relation to the Ordinary shares is now 108.2p comprising cumulative distributions of 69.25p per Ordinary share and a residual NAV per Ordinary share of 38.9p as at 31 December 2021.

As previously reported, the Board remains focused on identifying exit opportunities for the remainder of the Ordinary share pool investment portfolio. Realisations in the last four years have enabled the payment of a total of 45p per Ordinary share in dividends to Ordinary shareholders, representing 70.5% of the NAV per Ordinary share as at 31 December 2017 and we still retain net assets of 38.9p per Ordinary share as at 31 December 2021. Notwithstanding this success, we remain confident that, overall, there remains the opportunity to realise further value for Ordinary shareholders in due course (particularly in relation to our AIM holdings).

Ordinary Shares - Investment Portfolio Review

The remaining Ordinary share portfolio now comprises two AIM quoted holdings valued at £3.0 million, and five unquoted holdings – the carrying value of three of which have been maintained at zero with the combined carrying value of the other two being £238k, one of which has been reduced by £78k during the period.

Shareholders will note that the AIM quoted holdings represented 94% of the Ordinary share pool’s NAV at the year end, with Scancell comprising 68% and Arecor 26% of the Ordinary share pool NAV. As a result, the NAV per Ordinary share now fluctuates largely in line with the movement in the AIM quoted investments, particularly the Scancell share price. Whilst the Scancell share price showed volatility during 2021, it is not our policy to update the market following each of these fluctuations unless there are considered to be abnormal events (e.g. sale of a significant holding – see below). Your Board therefore recommends that shareholders or prospective shareholders keep both the Scancell and Arecor share prices under review and consider their impact on the Ordinary share NAV per share before taking any action in relation to an existing or prospective holding in the Company’s Ordinary shares.

Further details in relation to the Ordinary share pool’s investment portfolio are included in the Investment Manager’s Report on pages 27 to 33.

Ordinary Shares – Update and Outlook

As noted above, the Ordinary share pool’s NAV fluctuates largely in line with the movement in the AIM quoted investments and following the year end, there has been a sustained decrease in Scancell’s share price. The share price of Scancell decreased significantly from 19.5p at 31 December 2021 to 11.5p at 23 March 2022 (a decrease of 41%) and likewise Arecor’s share price decreased from 370p at 31 December 2021 to 350p at 23 March 2022 (a decrease of 5%). Given this downward trend since the year end, especially the percentage decrease in Scancell’s share price, the Ordinary share pool’s unaudited NAV is 29.2p per Ordinary share at 23 March 2022.

The Commercial Advisory Committee (“CAC”), which now consists of myself and Richard Roth, will continue to monitor the share price movement of its AIM quoted holdings and the commercial progress of its unquoted investments whilst continuing to seek to return to Ordinary shareholders over time the proceeds from any realisations in the form of dividends or by means of a return of capital.

In addition, the Ordinary share portfolio held £318k in cash as at 31 December 2021. This cash is available to make follow-on investments into existing Ordinary share portfolio companies where the Board believes this will protect the Ordinary share pool’s existing investment and/or improve the overall prospects of a timely exit from an investee company. Despite a couple of the Ordinary share pool unquoted portfolio companies seeking further funds during the year, we did not consider the terms attractive nor likely to improve the overall prospects for a timely realisation from the investee company and therefore no further Ordinary share pool investments were made apart from our investment in Arecor as previously referred to.

Ordinary shareholders will recall that, following the appointment of Seneca as Investment Manager in August 2018, the Ordinary share pool did not incur any running costs until July 2021. From July 2021, the Company’s running costs were to be shared between the Ordinary and B share pool pro-rata to their respective NAV subject to a 3% cost cap. Since July 2021, the Ordinary share pool’s proportion was £16k as at 31 December 2021.

Fund Raising

During the year the Company has allotted 5,525,711 B shares raising gross proceeds of £5,668k in the process.

Annual General Meeting

The Company’s AGM will be held at 10:00 a.m. on Wednesday, 27 April 2022 at the Company’s registered address 9 The Parks, Haydock, WA12 0JQ.

We welcome all shareholders who wish to attend the AGM this year in person and for those unable to attend, we will be hosting our bi-annual shareholder update presentation with a question and answer (Q&A) session to follow, starting at 2:00 p.m. on 19 April 2022. Shareholders should note that only the formal business set out in the notice of AGM will be considered at the AGM and we encourage shareholders to attend the presentation and ask questions prior to the AGM. Further details about the shareholder update presentation can be found on the Company’s website at https://senecavct.co.uk/april-2022-shareholder-presentation/.

We strongly encourage shareholders to vote on the matters of business through the completion of a proxy form, which can be submitted to the Company’s Registrar. Proxy forms should be completed and returned in accordance with the instructions thereon and the latest time for the receipt of proxy forms is 10:00 a.m. on 25 April 2022. Proxy votes can be also be submitted by CREST.

All resolutions will be decided by a poll and therefore it is essential that shareholders wishing to vote submit their proxy forms by 10:00 a.m. on 25 April 2022.

The Board has reviewed my performance and has asked me to continue as Chairman. A resolution for my re-election is included in the AGM Notice. Consideration has been given to my long tenure as Chairman and the Board has commenced the process for identifying my potential successor but has asked that I continue as Chairman until such a time as my successor has been identified and appointed.

Resolutions for the re-election of Alex Clarkson, Richard Manley and Richard Roth are also included in the AGM Notice. As part of the Board’s succession planning, we are in the process of seeking a further appointment to the Board.

The Notice of the AGM includes resolutions empowering the Directors to issue further B shares following the date of the AGM, which will primarily be used for the issue of B shares under a further Offer which we intend to launch for the 2022/2023 tax year. This requires authorisation for the Directors to be able to allot up to a further 35,000,000 B shares. Including these resolutions in the AGM business will avoid the Company having to produce and send out a separate circular to convene a separate general meeting.

A summary of the resolutions to be proposed by the Company at the AGM is included on pages 45.

VCT Qualifying Status

Shoosmiths LLP provides the Board with advice on the ongoing compliance with HMRC rules and regulations concerning VCTs; they have confirmed that the Company remains within all the appropriate VCT qualifying regulations as at 31 December 2021.

Fund Administration

Our administration is conducted by Seneca at the Company’s registered address. Neville Registrars Limited (“Neville”) continue to maintain the shareholder register. All information in respect of both share classes including Annual Reports and notices of meetings can be found on our website www.senecavct.co.uk. We would remind shareholders who have not opted for electronic communications that this is more efficient and ecologically friendly than receiving paper copies by post and therefore encourage you to contact Neville, whose details are on page 98, to advise them of your wish to switch to electronic communication.

Auditor

UHY Hacker Young LLP (“UHY”) has audited the Company’s annual results for the year ending 31 December 2021. UHY has indicated its intention to resign as auditors for the Company and will therefore not be recommended for re-appointment at this year’s AGM.

The reason for the resignation of UHY is as a result of a firm wide strategic review.

In the interest of good governance, the Company commenced a tender process in December 2021 and will consider the results of the tender in due course. Following the conclusion of the tender process, the Board will appoint a new external auditor which will then be proposed for reappointment at next year’s AGM through an Ordinary Resolution for shareholder approval.

Future Prospects

We are pleased with the progress of both the Ordinary and B share pools during the year.

We also note that Seneca has seen an increasing number of quoted and unquoted deals in Q1 2022, though the impact of macro-economic and geopolitical events continue to affect economic recovery post-Covid. However, the current tax year is likely to demonstrate record-breaking demand for VCTs as tax advantaged investment continues to play a key role in economic growth. With over £6.7 million of cash on the B share pool balance sheet at 31 December 2021, Seneca believes that it is very well placed to continue to support the existing B share investment portfolio as well as adding attractive new growth capital investments to the B share portfolio from the strong pipeline of opportunities presented to them. We therefore look forward to the continued development of the B share portfolio in due course.

Your Board continues to view the future of our Company with confidence.

John Hustler

Chairman

24 March 2022

Investment Manager’s Report

We are pleased to set out in this section further details in relation to the development of both the B and Ordinary share pools and their respective investee companies during 2021.

The B Share Pool

Fundraising

Our third B share offer concluded in September 2021, bringing total funds raised to £13.5 million, a £6.3 million increase in funds raised since the previous offer (an 86% increase in cumulative funds raised as at the close of the third offer). Our fund-raising efforts have since continued under our fourth B share Offer that was launched in October 2021, with a further £0.9 million being raised under this fourth Offer as at 31 December 2021. We are encouraged by the funds raised following the launch of the new Offer and remain focused on increasing the size of the B share pool, which will in turn allow us to increase the number and diversity of new investments that we make.

Performance and Dividends

Despite some continuing economic uncertainty in the year resulting from the ongoing Covid-19 pandemic, we are pleased with the development of the B share portfolio, with seven additional investments being made in the year. We are also pleased to report an increase in the NAV Total Return per B share, from 97.8p at 31 December 2020 to 109.1p as at 31 December 2021. The B share pool has to date paid 9.0p per B share in dividends since inception and has seen a 37% increase in the NAV (inclusive of dividends paid) as at 31 December 2021 from the 30 March 2020 NAV of 79.5p per B share at the start of the Covid-19 pandemic.

This increase in NAV Total Return per B share was the result of an increase in both AIM quoted investment values and unquoted investment values, the impact of four full and partial realisations, offset by the Company’s running costs, although these costs are being shared across both share classes pro rata to their respective NAVs from July 2021.

The B share pool’s unquoted investee company ADC Biotechnology Limited was acquired in 2021 and the Company received £264k in proceeds, generating a profit versus original cost of £115k (a 1.8x return on original investment cost).

The two B share dividends paid during the year were in line with the Company’s ambition to continue to pay dividends on the B shares and it should be noted that the Company has sufficient distributable reserves to enable the continued declaration of B share dividends over the medium term subject to Board approval, the B share pool investment pipeline and liquidity levels.

AIM Quoted Investments

The AIM market continued to provide ample opportunity to both invest and de-risk existing holdings yielding attractive returns for investors. As such we took the opportunity to realise just over half of the B share pool’s original holding in SkinBioTherapeutics Plc (“SkinBio”) and just under half of the B share pool’s original holding in Gelion Plc (“Gelion”).

The Company sold 2,520,000 shares in SkinBio during the year, which represented 54% of the original holding of 4,677,107 shares, reducing the remaining holding to 1,982,107 shares. These were sold at a weighted average price of 44.7p per share providing a return of 2.8x on original cost.

In November 2021, the B share pool invested £631k into AIM quoted company Gelion at a price of 145.0p per share. In December 2021, the Company was able to realise 185,000 shares, which represented 42% of the original holding of 435,492 shares, reducing the remaining holding to 250,492 shares. These were sold at a weighted average price of 284.3p per share providing a return of 2.0x on original cost.

The Company also sold 78,000 shares in Abingdon Health Plc for a total of £76k at 98p per share generating a nominal profit.

We were also encouraged that during the year we saw an increase in high quality AIM investment opportunities resulting in six new AIM investments being added to the B share portfolio.

Co-investing With Seneca EIS Funds

More generally we continue to develop Seneca’s position in the market as an active growth capital investor and up to 31 December 2021, Seneca has raised and deployed more than £100 million of EIS and VCT capital into over 55 SME companies, through over 100 funding rounds, since we undertook our first EIS investment in 2012. This includes £8.1 million raised to date by the B share pool.

The sixteen investments in the B share portfolio had a value of £7,953k as at 31 December 2021 and all but two are co-investments with EIS funds also managed by Seneca. We believe that the opportunity for the Company’s B share pool to co-invest with EIS funds that are also managed by Seneca provides the B share pool with a number of advantages including being able to participate in a higher number of investments, of a larger scale, into more established businesses than would be possible for the B share pool on a standalone basis.

Further, as a result of our position in the UK market as an active growth capital investor we maintain a strong pipeline of investment opportunities, particularly in the North of England, with a focus on well managed businesses with strong leadership teams that can demonstrate established and proven concepts in addition to growth potential. We aim to invest in both unquoted and AIM/AQSE quoted companies and are pleased to have completed six additional AIM quoted investments in the year.

Investee Company Updates

We are very happy with the development of the B share investment portfolio. As noted above, we are delighted to have been able to include a healthy number of AIM quoted investments in the B share pool to date and are very happy that we have also started to establish a positive exit track record, having achieved an aggregate average return of 1.9x from the seven exits achieved to date. These early profits have supported the performance of the B share pool NAV at the same time as we continue to develop the unquoted company investment portfolio.

We are excited about the potential that lies with the B share investment portfolio and have included updates in relation to the top eight investments by value in the B share pool investee companies later in this Investment Manager’s Report. In particular we are pleased with the positive momentum being shown by Qudini Limited (“Qudini”) and Silkfred Limited (“Silkfred”) which have both seen impressive increases in demand for their products and services in the year, however we note that Ten80 Ltd has struggled to make the commercial traction anticipated and with the outcome of the continuing fundraise efforts of the company uncertain and some changes in the leadership of the business we have taken the decision to reduce the carrying value of this investment to zero.

Investments made after the Year End and outlook

Following the year end we also completed an additional investment of £500k into the IPO of Clean Power Hydrogen Plc (“CPH2”). CPH2 is a producer of green hydrogen electrolysers, a disruptive and unique technology that delivers high stack (assembly of fuel cells) efficiency at low cost and eliminates expensive/degradable membranes from the traditional hydrogen production process. The company raised £30.5 million at AIM admission, principally to fund capital investment in two production facilities, working capital and R&D activities. The revenue model will be dual-focus. In addition to selling units to Blue Chip customers the technology will also be licensed to key strategic partners.

Shortly after the IPO of CPH2, the share price increased by c.40%. In view of this increasing share price and the increased volatility of the AIM market following macroeconomic and geopolitical events in February 2022, the Company took the opportunity to realise a profit and sold the full holding in CPH2, realising £674k at an average share price of 60.6p per share, generating a profit versus original cost of £174k (a 1.35x return on the original investment).

In March 2022, the Company made a further investment of £280k into the AIM quoted company Verici Dx Plc from the B share pool.

Further, the Company sold 125k additional shares in SkinBio following the year end, realising £65k at an average share price of 51.6p per share, generating a profit versus original cost of £45k (a 3.2x return on the original investment). This reduced the remaining holding to 1,857,107 shares.

We look forward to continuing to increase the funds raised for the B share pool under the current Offer and with several new investment opportunities in the later stages of due diligence, we expect to add to the portfolio of B share investee companies in the coming months. We are very satisfied with the development of the B share pool to date and view the future of the B share pool with confidence.

Investment Portfolio – B shares

Unquoted Investments	Equity held %	Investment at cost £'000	Unrealised profit/(loss) £'000	Carrying value at 31 December 2021 £'000	Movement in the year to 31 December 2021 £'000
Solascure Ltd	3.2	750	333	1,083	333
Fabacus Holdings Limited	2.0	500	63	563	-
Silkfred Limited	<1.0	500	-	500	-
Old St Labs Limited	3.5	500	-	500	-
Qudini Limited	2.4	500	-	500	200
Bright Network Ltd	1.7	234	47	281	47
Ten80 Ltd	7.5	400	(400)	-	(400)
Total unquoted investments		3,384	43	3,427	180
Quoted Investments	Shares held	Investment at cost £'000	Unrealised profit/(loss) £'000	Carrying value at 31 December 2021 £'000	Movement in the year to 31 December 2021 £'000
Polarean Imaging Plc	1,644,070	986	(82)	904	(82)
SkinBioTherapeutics Plc	1,982,107	317	496	813	377
Arecor Therapeutics Plc	188,053	425	271	696	271
Poolbeg Pharma Plc	7,550,000	755	(76)	679	(76)
Aptamer Group Plc	495,726	580	74	654	74
Gelion Plc	250,492	363	(13)	350	(13)
Evgen Pharma Plc	5,000,000	400	(150)	250	(150)
OptiBiotix plc	350,000	141	14	155	(45)
Abingdon Health plc	78,250	75	(50)	25	(48)
Total quoted investments		4,042	484	4,526	308
Total investments		7,426	527	7,953	488

Exits for the period	Investment Date	No. of Shares sold	Investment at cost £'000	Sale Proceeds £’000	Realised profit/(loss) £'000	Exit Multiple
Abingdon Health Plc*	December 2020	78,000	75	76	2	1.0
ADC Biotechnology Ltd	August 2020	150,000	150	265	117	1.8
SkinBioTherapeutics Plc*	February 2019	2,520,000	403	1,125	722	2.8
Gelion Plc*	November 2021	185,000	268	524	255	2.0
Total			896	1,990	1,096	1.9

*Partial exit

B Share Pool – Investment Portfolio

Listed below are details of the Company’s eight largest B share pool investments by value as at 31 December 2021.

• Solascure Ltd

Initial investment date:	January 2021	Solascure is an early stage wound care specialist, originally spun out of and working alongside BRAIN (world leading German biotech company), to develop a new-to-market wound care product.  Solscure’s Aurase product is a gel-based product that efficiently and gently cleans wounds, making the healing process much more straightforward. Pre-clinical work has been extremely positive and the clinical trial is now underway.  Chronic wounds are a growing global problem, and alternative methods of treatment for hard to heal wounds are extremely expensive, ineffective, impractical and slow. Solascure’s proprietary technology utilises “maggot theory” debridement without the cost or labour input of live maggots. In simple terms, it uses maggot enzymes to facilitate and also promote the body’s own wound cleansing processes. Core benefits of the product are the clear practical elements, as well as the reduced time scale to full debridement without delaying wound healing.  Progress made by the company in 2021 includes:  Obtaining full sign off of its clinical trial, with FDA approved protocol and first in-human studies commenced.   Completing a £3.7m top-up funding round in November 2021 in order to fund adequate runway and additional headroom to complete the first stage trial and enter into any strategic discussions with the benefit of a strong cash balance.  The commercial strategy for Aurase remains unchanged, with the company aiming to disrupt a number of attractive segments of the chronic wounds market, worth c. $5bn globally. The market currently utilises a wide range of debridement techniques and products, with no clear, recognised leader. There has been minimal progress made in this space for many years and therefore we remain excited about the future prospects of the business should the trial go to plan.
Cost:	£750,000
Valuation:	£1.1 million
Equity type:	Unquoted
Equity held:	3.2%
Last statutory accounts:	30 June 2020
Turnover:	Not Disclosed
Loss before tax:	Not Disclosed
Net assets:	£6.2 million
Valuation method:	Cost and price of recent investment (reviewed for any fair value adjustment)

• Polarean Imaging Plc

Initial investment date:	March 2021	Polarean Imaging Plc (“Polarean”) is a healthcare technology company with a proprietary drug-device combination that provides a visual representation of ventilation and gas exchange in the lungs. This is achieved by the patient inhaling polarised Xenon-129 gas (a non-radioactive, noble gas) whilst having an MRI scan. Polarean technology is effectively an add-on feature for research and clinical medical environments using MRI scanners. There are an estimated 35,000 MRI scanners being used globally.In March 2021, Polarean raised additional capital ahead of the final U.S. Food and Drug Administration’s (“FDA”) approval to position the business for commercial scale and as part of that £20m round, with up to £9m VCT/EIS qualifying, Seneca came in as a cornerstone investor with just under £1m invested through the VCT and a further £400k in EIS funds. Seneca had invested from its EIS funds in March 2020 to provide working capital support during the period from initial FDA submission in H2 2020 to anticipated clearance and through to commercial launch.Progress made by the company since March 2021 includes:   Seeking FDA approval for its drug-device, which has gained wider use and attention as a result of Covid-19 and its effects on the lungs as well as the impact of long-covid on lung function. The company announced in October 2021 that the FDA had been unable to approve the submission at the first time of asking, but that the issues were technical in nature, and management remain confident with regard to the safety and efficacy profile. As such, the company is in dialogue with the FDA with the aim of ensuring the resubmission process is as efficient as possible. Installation of its 9820 Xenon Polariser system at BC Children's Hospital, Vancouver BC, a major paediatric research and teaching hospital. Since the year end, the company has also announced an order for a Xenon Polariser system from McMaster University in Ontario, Canada.
Cost:	£986,000
Valuation:	£904,000
Equity type:	Quoted
Equity held:	<1.0%
Last statutory accounts:	31 December 2020
Turnover:	£1.1m
Loss before tax:	£6.5 million
Net assets:	£10.9 million
Valuation method:	Bid price of 55p per share

• SkinBioTherapeutics Plc

Initial investment date:	February 2019	SkinBioTherapeutics is a life science company focused on skin health. The company's proprietary platform technology, SkinBiotixTM, is based upon discoveries made by Dr. Cath O'Neill and Professor Andrew McBain. SkinBioTherapeutics' platform applies research discoveries made on the activities of lysates derived from probiotic bacteria when applied to the skin. The company has shown that the SkinBiotixTM platform can improve the barrier effect of skin models, protect skin models from infection and repair skin models. Proof of principle studies have shown that the SkinBiotixTM platform has beneficial attributes applicable to each of these areas.  The aim of the company is to develop its SkinBiotixTM technology into commercially successful products supported by a strong scientific evidence base. SkinBioTherapeutics’ commercial strategy is to engage health and wellbeing and/or pharmaceutical companies in early dialogue to build up relationships and maintain communication on technical progress until one or more commercial deals can be secured. Progress made by the company in 2021 includes:   Excellent development of the company’s Axisbiotix-Ps food supplement product, which has the potential to be a leading psoriasis treatment. The business reported impressive results and launched the product direct-to-consumers in Q4 2021 on World Psoriasis Day.   Initiation of a research and development programme in oral health in conjunction with the University of Manchester. The oral health programme will explore the use of different bacteria, including SkinBioTherapeutics' proprietary lysate, SkinBiotix®, for oral health and well-being. The 12-month programme will develop and test formulations designed to support the health of skin surfaces in the oral cavity targeting disease prevention, oral care and hygiene.    Progression of multiple new opportunities across its MediBiotix, CleanBiotix and PharmaBiotix divisions, including the development of eczema treatments as well as additional opportunities designed to reduce hospital acquired infections.
Cost (of the portion of the original investment still held as at 31 December 2021):	£317,000
Valuation:	£813,000
Equity type:	Quoted
Equity held:	1.26%
Last statutory accounts:	30 June 2021
Turnover:	Not Disclosed
Loss before tax:	£1.6 million
Net assets:	£2.8 million
Valuation method:	Bid price of 41p per share

• Arecor Therapeutics Plc

Initial investment date:	May 2021	Arecor Therapeutics Plc (“Arecor”) was admitted to the AIM market on 3 June 2021 and raised £20 million at that point. Arecor was an existing investee company of the Ordinary share portfolio and the B share pool invested £425k in the IPO. The Ordinary share pool also supported the IPO with a further investment of £85k. Arecor’s treatments for people living with chronic disease are designed to advance patient care and improve clinical outcomes. Its product portfolio for diabetes currently includes novel insulin formulations to deliver an ultra-rapid acting insulin (AT247), and an ultra-concentrated rapid acting insulin (AT278). Progress made by the company since May 2021 includes:  Successful IPO on AIM, raising £20 million. Positive results from Phase I clinical trial for AT278 demonstrating significantly early accelerated PK/PD profile compared to market leading comparator, NovoRapid®. Positive Phase I clinical data of AT247 presented at ATTD, the leading international diabetes conference. Received FDA clearance of IND application for AT247, paving the way for the US clinical trial. Signed five new partnership agreements with Eli Lilly and Company, Par Sterile Products and Intas Pharmaceuticals, a leading global medical products company and a global technology leader. Awarded £2.8 million Innovate UK grant to support Phase II development of AT247. European patent EP2457590 on polysaccharide vaccines was successfully upheld following opposition appeal from GlaxoSmithKline. Announced continued progress of its co-development of the ready-to-use injectable medicine AT282, the first of two co-development programmes with Hikma Pharmaceuticals.
Cost:	£425,000
Valuation:	£696,000
Equity type:	Quoted
Equity held:	<1.0%
Last statutory accounts:	31 December 2020
Turnover:	Not Disclosed
Loss before tax:	Not Disclosed
Net assets:	£907,000
Valuation method:	Bid price of 370p per share

• Poolbeg Pharma Plc

Initial investment date:	July 2021	Poolbeg Pharma Plc (“Poolbeg”) is a clinical-stage pharmaceutical company focused on the development and commercialisation of therapies to treat and prevent infectious diseases. The company has adopted a capital-light model which enables it to develop multiple products faster and more cost effectively than the traditional biotech model. Poolbeg aspires to become a “one-stop shop” for big pharma to find Phase II ready products for development and commercialisation. The company’s lead asset is POLB 001, a first-in-class, Phase II ready drug with the potential to treat serious unmet needs in patients suffering from severe influenza. The company was spun-out of Open Orphan plc, a former Seneca EIS portfolio company, so the Poolbeg management team is well-known to Seneca and has proven capabilities in identifying, acquiring and accelerating assets through development to commercialisation.Progress made by the company since July 2021 includes:  Continuing to broaden its portfolio of licenced assets with the addition of a first-in-class broad spectrum RNA-based immunotherapy for respiratory virus infections from the University of Warwick. Signing a licence agreement to develop an oral vaccine delivery platform and an option agreement to licence MelioVac, a preclinical vaccine for melioidosis, with University College Dublin ('UCD') and its inventor, Associate Professor Siobhán McClean, through NovaUCD, the university's knowledge transfer office. The company will continue its due diligence on MelioVac as well as 5 other potential vaccine candidates discovered by Associate Professor McClean and her team, for the duration of the option agreement, prior to signing a 'licence agreement'. Expanding its portfolio of assets, the company signed numerous agreements to help further develop POLB 001 and enable the company to commence the Phase Ib human challenge study of POLB 001 in June 2022, which will be a key step in the molecule's development.
Cost:	£755,000
Valuation:	£679,000
Equity type:	Quoted
Equity held:	1.5%
Last statutory accounts:	First accounts made up to 31 December 2021due by 30 June 2022
Turnover:	Not Disclosed
Loss before tax:	Not Disclosed
Net assets:	Not Disclosed
Valuation method:	Bid price of 9p per share

• Fabacus Holdings Limited

Initial investment date:	February 2019	Fabacus is an independent software company that has developed a complete product lifecycle solution, Xelacore, aimed at bringing transparency to supply chain networks, with an initial focus on resolving the interaction and information flow between global licensors and their licensees. Xelacore is a modular, Software as a Service solution with an intuitive interface and proprietary data aggregation and management engine that allows all stakeholders to operate on a single unified and collaborative platform. It bridges the gaps in an inefficient process within the current retail ecosystem by creating authenticated, enriched universal records that unlock opportunities, reduce risk and drive performance for both licensors and licensees. Progress made by the company in 2021 includes:  Commencing a £5m fundraise to continue to develop its Xelacore solution, with a big push to increase monthly recurring revenue.   Continuing to onboard fee-paying licensees to their market leading data platform with high-profile partnerships and excellent progress with a number of customers, most notably through its promising relationship with Amazon.
Cost:	£500,000
Valuation:	£563,000
Equity type:	Unquoted
Equity held:	2.0%
Last statutory accounts:	31 August 2020
Turnover:	Not Disclosed
Loss before tax:	Not Disclosed
Net assets:	£8.6 million
Valuation method:	Price of last fundraise

• SilkFred Limited

Initial investment date:	December 2018	SilkFred is an online marketplace for independent ladies’ fashion brands. The business was founded in 2011 with the aim of creating an efficient marketplace for emerging fashion designers to bring products to market and establish their brand in the sector. The business now works with c.900 independent brands, selling to over 800k customers per annum.  SilkFred acts as a central marketing and sales platform for these brands, charging commission in exchange for these services, and as a result the business itself takes minimal inventory / working capital risk on new brands, lines or products.  The business model revolves around a market leading and scalable customer service platform, and as such SilkFred is continually investing in core infrastructure and constantly seeking innovative methods to enhance the customer experience. Progress made by the company in 2021 includes: An impressive recovery from the challenges posed to the retail sector by Covid-19. The company is now profitable and is once again trading in line with forecasted revenue growth.   Continuing growth in international sales. It is clear that the international potential of the brand is a key driver of the future value in the business and it is therefore encouraging to see international sales continuing to grow.   Attraction of ‘stock-lite’ business model reinforced by robust trading performance with an extremely flexible supply chain of c.900 independent brands and a very small proportion of stock carried in comparison to sales levels. The Covid-19 environment has already seen the loss or weakening of some significant competitors who are more exposed to the traditional ‘stock-heavy’ business model and high street presence.
Cost:	£500,000
Valuation:	£500,000
Equity type:	Unquoted
Equity held:	<1%
Last statutory accounts:	31 December 2020
Turnover:	£17.3 million
Loss before tax:	£2.3 million
Net assets:	£2.5 million
Valuation method:	Revenue multiple

• Old St Labs Limited

Initial investment date:	March 2019	Old St Labs (“Vizibl”) is a provider of cloud based, supplier collaboration software solutions for large, blue chip customers, enabling them to manage key supplier relationships and strategic project work. The core product, Vizibl, seeks to make supplier collaboration much more straight forward, with key focus on compliance, savings / efficiency and driving growth across the business.  Vizibl taps into a growing trend in supplier collaboration, having moved on from the initial focus on compliance, to an increased emphasis on savings / efficiency, and recent developments highlighting the benefits in terms of wider growth strategy for large customers, including helping them promote their core ESG agenda items throughout their supply chain.  Vizibl provides the infrastructure, governance and reporting capabilities to optimise present supplier performance and acts as a springboard for those collaborative supplier relationships. The product is CRM / ERP agnostic, working alongside all major software providers to ensure the collaboration software is insightful and informative. Progress made by the company in 2021 includes: An uplift in new sales momentum following a slow-down in large enterprises’ decision making and budget constraints in 2020 following the onset of the Covid-19 pandemic. The business realigned itself with a number of retained customers and subsequently addressed and extended key customer contracts. Continuing growth in contracted annual recurring revenue (ARR) with a particular focus on sustainability and ESG reporting which has generated traction with major customers. The business signed new three-year contracts with Vodafone in Q1 2021 and Astellas with a further two deals in Q4 2021. In total the business now has 9 material global businesses signed up as customers. The company’s pipeline also remains healthy with a further customer acquisitions expected in Q1 2022.   Strong progress towards the launch of an ESG specific module in 2022, with the Vizibl platform already containing the capabilities to allow large enterprises to manage their ESG agenda through their supply chain. Initiatives and requirements such as Scope 3 emissions reporting are moving to the forefront for large enterprises, and it is widely expected that reporting, auditing, monitoring and improving these figures will be a key area of focus for corporates over the coming years.
Cost:	£500,000
Valuation:	£500,000
Equity type:	Unquoted
Equity held:	3.8%
Last statutory accounts:	31 March 2021
Turnover:	Not Disclosed
Loss before tax:	Not Disclosed
Net liabilities:	£1.5m
Valuation method:	Revenue multiple

The Ordinary Share Pool

Shareholders will recall that whilst Seneca is the Company’s Investment Manager, responsibility for the management of the Ordinary share pool investments continues to rest with those remaining members of the Board of Directors who were serving at the point of Seneca’s appointment on 23 August 2018, which now includes John Hustler and Richard Roth.

AIM Quoted Investments

The Ordinary share pool’s largest investment is AIM quoted Scancell and this represented 68% of the Ordinary share pool’s NAV as at 31 December 2021. During the year, the Scancell share price increased by 44% from 13.5p as at 31 December 2020 to 19.5p at 31 December 2021. In view of this increasing share price, the Company took the opportunity to realise some profit and sold a small portion of Scancell shares during the year (1,000,000 shares (8%) were sold from a holding at the start of the year of 12,000,000 shares) realising £217k and generating a profit versus original cost of £157k (a 3.6x return on the original investment) and a profit versus the 31 December 2020 carrying value of £82k. The Ordinary share pool’s remaining stake in Scancell of 11,000,000 shares increased in value by £660k during the year to stand at £2,145k as at 31 December 2021.

The Ordinary share pool’s investment in Arecor, a long-standing unquoted investee company, announced its intention to float on AIM in May 2021. The Company considered the terms of the fundraise to be attractive and in order to support the IPO the Ordinary share pool purchased a further 37,611 shares in Arecor at £2.26 per share. Following a share reorganisation prior to flotation, the Ordinary share pool’s existing shares were converted to 186,366 shares and the Ordinary share pool now holds a total of 223,977 shares in Arecor valued at £829k (compared to an original cost of £227k)

Unquoted Investments

With regard to the Ordinary share pool’s unquoted investments, the carrying value of Fuel 3D Technologies Limited (“Fuel 3D”) was reduced as a result of the company completing a £1.5m fundraise in 2021. The carrying value of Fuel 3D has been reduced to bring it in line with the price of their 2021 fundraise. The remainder of the Ordinary share pool’s unquoted investment valuations have been maintained by the Company in the period.

Performance and DividendsAs a result of the above AIM quoted investee company realisation, the Ordinary share pool was able to pay a dividend of 4p per Ordinary share during the period.

The Total Return in relation to the Ordinary shares is now 108.2p comprising cumulative distributions of 69.25p per Ordinary share and a residual NAV per Ordinary share of 38.9p as at 31 December 2021.

As noted in the Chairman’s statement, the Company is focussed on realising assets in the Ordinary share pool at the appropriate time with the proceeds then being distributed to Ordinary shareholders as dividends – it is therefore noteworthy that in the 4 years to 31 December 2021 the Company has paid out dividends totalling 45p per Ordinary share (equivalent to 70.5% of the NAV per Ordinary share of 63.8p as at 31 December 2017) and the Ordinary share pool also retains NAV per Ordinary share of 38.9p as at 31 December 2021.

Investment Portfolio – Ordinary shares

Unquoted Investments	Equity held %	Investment at cost £'000	Unrealised profit/(loss) £'000	Carrying value at 31 December 2021 £'000	Movement in the year to 31 December 2021 £'000
Insense Limited	4.6	509	(388)	121	-
Fuel 3D Technologies Limited	<1.0	299	(182)	117	(78)
OR Productivity Limited	3.7	765	(765)	-	-
Microarray Limited	3.0	132	(132)	-	-
ImmunoBiology Limited	1.2	868	(868)	-	-
Total unquoted investments		2,573	(2,335)	238	(78)
Quoted Investments	Shares held	Investment at cost £'000	Unrealised profit/(loss) £'000	Carrying value at 31 December 2021 £'000	Movement in the year to 31 December 2021 £'000
Scancell plc	11,000,000	665	1,480	2,145	660
Arecor Limited	223,977	227	602	829	539
Total quoted investments		892	2,082	2,974	1,199
Total investments		3,465	(253)	3,212	1,121

Exits for the period	Investment Date	No. of Shares sold	Investment at cost £'000	Sale Proceeds £’000	Realised profit/(loss) £'000	Exit Multiple
Scancell plc *	December 2003	1,000,000	60	217	157	3.6
Total			60	217	157	3.6

Ordinary Share Pool – Investment Portfolio

Listed below are details of the Company’s Ordinary share pool investments as at 31 December 2021.

• Scancell plc

Initial investment date:	December 2003	Scancell is an AIM listed biotechnology company that is developing a pipeline of therapeutic vaccines to target various types of cancer, with the first target being melanoma.  The ImmunoBody platform technology educates the immune system how to respond – this means that the technology can also be licensed to pharmaceutical companies to assist the development of their own therapeutic vaccines, which is an area of emerging importance for which a number of big pharmas do not have in-house technology.  In addition, in 2012 a second platform technology, Moditope, was announced and is based on exploiting the normal immune response to stressed cells and is complementary to the ImmunoBody platform. The AvidMab platform was established in 2018 which allows direct tumour killing. Scancell continues to develop its multiple technologies.  Progress made by the company in 2021 includes:   First subject dosed in the company's Covid-19 vaccine Phase 1 clinical trial (COVIDITY) in South Africa, with 16 patients having been recruited to date.   Selection of PharmaJet's Needle-free Injection System to administer the company's two SARS-CoV-2 vaccine candidates.   Modi-1 Phase 1/2 clinical trial application approved by the UK's Medicines and Healthcare Products Regulatory Authority (MHRA) and challenges previously associated with formulation of the citrullinated enolase peptide successfully resolved.   Four clinical centres in the UK now operational in the company's SCIB1 Phase 2 clinical trial and the first patient was dosed at Churchill Hospital, Oxford University Hospitals Trust following the year end.   Continued the development of a unique, rich pipeline of tumour-specific anti-glycan antibodies with the initial aim of generating early-stage clinical data, either alone or in combination with potential strategic partners.   Applied AvidiMab™ technology to the company's internal programmes to engineer and enhance potency of its anti-glycan antibodies, ImmunoBody® cancer products and Covid-19 vaccine candidates.   Professor Lindy Durrant, founder, Board Director and Chief Scientific Officer of Scancell, appointed as Chief Executive Officer of Scancell Holdings plc in July 2021.   Expanded the Group's R&D capabilities by taking new laboratory and office space in the Bellhouse Building at The Oxford Science Park.   The company's capital structure has been improved through the extension of the redemption dates of the outstanding unsecured Convertible Loan Notes ("CLNs") issued by the company in 2020.
Cost (of the portion of the original investment still held as at 31 December 2020):	£665,000
Valuation:	£2.1 million
Equity type:	Quoted
Equity held:	1.4%
Last statutory accounts:	30 April 2021
Turnover:	£nil
Loss before tax:	£16.8 million
Net assets:	£19.5 million
Valuation method:	Bid price of 19.5p per share

• Arecor Therapeutics Plc

Initial investment date:	January 2008	Arecor Therapeutics Plc (“Arecor”) was admitted to the AIM market on 3 June 2021 and raised £20 million at that point. Arecor was an existing investee company of the Ordinary share portfolio and the B share pool invested £425k in the IPO. The Ordinary share pool also supported the IPO with a further investment of £85k.For more information on the company and progress made in the year, please see page 21, B Share Pool Investment Portfolio summary.
Cost:	£227,000
Valuation:	£829,000
Equity type:	Quoted
Equity held:	1.1%
Last statutory accounts:	31 December 2020
Turnover:	Not Disclosed
Loss before tax:	Not Disclosed
Net assets:	£907,000
Valuation method:	Bid price of 370p per share

• Insense Limited

Initial investment date:	July 2003	Insense is an innovative, biotechnology company and was spun-out from Unilever’s R&D laboratory in 2001.It has since had two successful spinouts, namely Arecor (see above) and Archimed, from which Microarray (see below) was also spun-out. Current Insense development activity is concentrated on dermatology products for both professional and consumer applications.  Progress made by the company in 2021 includes:   Developing a topical treatment for fungal nail infections which aims to deliver comparable fungal kill to that of systemic drugs, but without the side effects. The company’s objective remains as previously: to complete early formulation development and then conduct a first‐in‐man clinical trial. At present, the first‐in‐man trial is scheduled to complete at the end of 2024. Over the coming months they will be looking at options to shorten the timeline if possible. Agreed the terms of a patent licence with Smith+Nephew, one of the world’s leading manufacturers and suppliers of wound dressings. The licence expressly excludes their Fungal Nail treatment patent families.
Cost:	£509,000
Valuation:	£121,000
Equity type:	Unquoted
Equity held:	4.6%
Last statutory accounts:	31 December 2020
Turnover:	Not Disclosed
Loss before tax:	Not Disclosed
Net liabilities:	£232,000
Valuation method:	Price of last fundraise

• Fuel 3D Technologies Limited

Initial investment date:	March 2010	In 2014 Fuel 3D was formed to acquire the computer 3D imaging IP of Seneca Growth Capital Ordinary share investee company, Eykona. The initial application for this IP targeted by Eykona was measuring the volume of chronic wounds; however this has since developed and the current application focus is on a) measuring tumours in animals used in drug development via a product called BioVolume and b) enabling the manufacture of products to fit a particular individual e.g. masks used to treat certain medical conditions.BioVolume is Fuel 3D’s lead product and improves measurement accuracy, inter-operator consistency, animal welfare, cost efficiencies, compliance and the success of pre-clinical oncology research. Progress made by the company in 2021 includes: Continuing progress in the development of BioVolume in conjunction with major pharmaceutical companies but has suffered Covid-19 related delays. Orders were received from two global top ten pharmaceutical companies, with others currently in legals.   Continuing the development of the technology for FitsYou applications (e.g. sleep apnoea masks and eyewear) has taken longer than expected, though a commercial licensing agreement is expected in 2022.   Reduction in cost base lowered break-even point and £1.5m additional cash was raised in December 2021 and January 2022 from existing investors to provide sufficient runway to take it through to the end of 2022 and to exit one of BioVolume or FitsYou moving the company to a self funding model.
Cost:	£299,000
Valuation:	£117,000
Equity type:	Unquoted
Equity held:	< 1%
Last statutory accounts:	31 December 2020
Turnover:	£21,000
Loss before tax:	£3.7 million
Net assets:	£6.1 million
Valuation method:	Price of last fundraise

• OR Productivity Limited

Initial investment date:	March 2011	At the end of 2011, Freehand 2010 (a Seneca Growth Capital Ordinary share investee) was acquired by OR Productivity plc (“ORP”) in exchange for ORP shares. Freehand 2010 owns the intellectual property to technology incorporated in a product, FreeHand, for robotically controlling the laparoscope (part of the camera system) used in the growing sector that is keyhole surgery. The company sells the system outright and provides consumables although, increasingly, the business model is built upon free placement of the system with recurring revenue then being generated from the subsequent sale of a consumable per operation.Progress made by the company in 2021 includes: Raising £1.65 million in new funds and is now continuing to fundraise up to a further £500,000. Significant increase in robot sales in first half and seven new distributors appointed. Further capital to be raised in 2022 to fund US expansion.   The current fundraising has been through the issue of A Ordinary shares which carry a one times repayment preference. In addition further A Ordinary shares with the same preference have been issued to redeem certain outstanding liabilities. At the present time the Board considers it unlikely that the Ordinary share pool investment in ORP can be valued in excess of the value of the A Ordinary shares issued. The Ordinary share pool does not hold any A Ordinary shares.
Cost:	£765,000
Valuation:	£nil
Equity Type:	Unquoted
Equity held:	2.0%
Last statutory accounts:	31 March 2021
Turnover:	Not Disclosed
Loss before tax:	Not Disclosed
Net assets:	Not Disclosed
Valuation method:	Carrying value reduced to £nil

• ImmunoBiology Limited

Initial investment date:	November 2005	ImmunoBiology (“ImmBio”) is a biotechnology company that is focused on developing treatments for illnesses such as meningitis, tuberculosis, influenza and hepatitis C. The company’s technology is based on the discovery that a group of proteins known as ‘heat shock proteins’ has a pivotal role in controlling the normal immune response to infections. The focus is currently on a vaccine for Pneumococcal Disease, for which the challenge is that there are >90 strains in circulation but present treatments address only a small proportion. In 2016 a first in human study demonstrated safety in adults.  ImmBio has licensed its pneumococcal vaccine to China National Biotech Group. It has completed certain parts of its technology transfer and is now seeking to start a phase 2 study of the same vaccine. Covid-19 has again highlighted the importance of vaccines to the world and in recent years pneumococcal disease has claimed a similar number of deaths as Covid-19 in 2020. An existing vaccine has reduced the death rate, but the existing vaccines only protect against fewer than 20 of the 90 or so existing strains. As ImmBio’s ImmBioVax technology utilises heat shock proteins to activate T-cell responses, it is hoped that it can be used to create vaccines for a wide range of currently poorly served infectious diseases. Progress made by the company in 2021 includes:  Continuing with the technology transfer to a subsidiary company of China National Biotec Group to co-develop ImmBio’s proprietary PnuBioVax vaccine against pneumococcal disease and launch the pneumococcal vaccine in the Greater China area upon completion of successful clinical studies but there is also a requirement to start a clinical trial outside China which needs funding.   Work undertaken to partner with either Liverpool University or a linked entity to preserve the asset to maintain its working order.   Almost all staff have been made redundant as the company considers its commercial options and funding requirements.  ImmBio has a complex equity structure which has impacted the investment valuation. As such, the Board does not believe that the Company’s Ordinary share pool’s investment currently has any value.
Cost:	£868,000
Valuation:	£nil
Equity type:	Unquoted
Equity held:	1.2%
Last statutory accounts:	31 May 2021
Turnover:	£nil
Loss before tax:	Not Disclosed
Net liabilities:	£4,000
Valuation method:	Carrying value reduced to £nil

• Microarray Limited

Initial investment date:	January 2011	Microarray Ltd is a UK-based specialist wound healing company. Founded in 2000, Microarray was de-merged from Archimed, a spin-out from Insense (see above): the company is now privately owned.The company has access to wide ranging expertise in the fields of wound dressing product development, marketing and sales; electrochemistry and diagnostic sensor technologies; biochemistry, oxygen and iodine chemistry; enzymology, immunology and inflammation. Current research and development activities are concentrated on innovative wound care diagnostics.Microarray owns and continues to develop new intellectual property in its specialist fields. It works independently and with expert academic and industrial partners. Progress made by the company in 2021 includes: In consultation with its majority shareholder, Sussex Research Ltd, the company decided to halt the development of its biomarker-based algorithm due to limited progress and associated costs and is packaging the assets for acquisition. The main factors for stopping development have been lack of data to support the correlations with clinical diagnoses that the company had hoped for, the costs and continued delays caused by Covid-19. As a result, the company hasn't been able to develop a diagnostic algorithm that could potentially offer reliable decision support to clinicians, which was the aim of the project.   In parallel, the company continues to use machine-learning methods to analyse the high quality clinical data collected to date, and is investigating the commercial potential of these non-biomarker assets.
Cost:	£132,000
Valuation:	£nil
Equity type:	Unquoted
Equity held:	3.0%
Last statutory accounts:	31 December 2020
Turnover:	Not Disclosed
Loss before tax:	Not Disclosed
Net liabilities:	£4.4 million
Valuation method:	Carrying value reduced to £nil

Richard Manley Seneca Partners Limited 24 March 2022

Directors’ Report

The Directors present their Report and the audited Financial Statements for the year ended 31 December 2021.

The Directors consider that the Annual Report and Financial Statements, taken as a whole are fair, balanced and understandable and provide the information necessary for shareholders to assess the Company’s performance, business model and strategy.

Review of Business Activities

The Directors are required by section 417 of the Companies Act 2006 to include a Business Review to shareholders. This is set out on page 34 and forms part of the Strategic Report. The purpose of the Business Review is to inform members of the Company and help them assess how the Directors have performed their duty under section 172 of the Companies Act 2006 (duty to promote the success of the Company). The Company’s section 172 Statement on page 8, the Chairman's Statement on page 9 to 12, and the Investment Manager’s Report on pages 14 to 33 also form part of the Strategic Report.

The purpose of this review is to provide shareholders with a snapshot summary setting out the business objectives of the Company, the Board’s strategy to achieve those objectives, the risks faced, the regulatory environment and the key performance indicators used to measure performance.

Directors’ Shareholdings – Ordinary shares

The Directors of the Company during the period and their interests (in respect of which transactions are notifiable under Disclosure and Transparency Rule 3.1.2R) in the issued Ordinary shares of 1p are shown in the table below:

	31 December 2021	31 December 2020
	Number of Shares	Number of Shares
John Hustler	190,000	190,000
Alex Clarkson	-	-
Richard Manley	-	-
Richard Roth	209,612	209,612

All of the Directors’ shares were held beneficially. There have been no changes in the Directors’ Ordinary share interests between 31 December 2021 and the date of this report.

Directors’ Shareholdings – B Shares

The Directors of the Company during the period and their interests (in respect of which transactions are notifiable under Disclosure and Transparency Rule 3.1.2R) in the issued B shares of 1p are shown in the table below:

	31 December 2021	31 December 2020
	Number of Shares	Number of Shares
John Hustler	19,735	-
Alex Clarkson	10,060	-
Richard Manley	71,846	62,071
Richard Roth	15,000	15,000

All of the Directors’ B shares were held beneficially. There have been no changes in the Directors’ B share interests between 31 December 2021 and the date of this report.

Directors’ and Officers’ Liability Insurance

The Company has, as permitted by legislation and the Company’s Articles of Association, maintained directors’ and officers’ liability insurance cover on behalf of the Directors, Company Secretary and Investment Manager.

Whistleblowing

The Board has approved a Whistleblowing Policy for the Company, its Directors and any employees, consultants and contractors, to allow them to raise concerns, in confidence, in relation to possible improprieties in matters of financial reporting and other matters.

Bribery Act

The Board has a zero tolerance policy in relation to bribery and corruption. The Board has approved an Anti-Bribery Policy to ensure full compliance with the Bribery Act 2010 and to ensure that the highest standards of professional and ethical conduct are maintained. Through internal controls reporting it has sought to ensure adequate safeguards are in place at its main third party suppliers.

Management

Seneca as the Company’s Investment Manager is responsible for the management of the Company’s B share pool investments. Responsibility for the management of the Ordinary share pool investments has been delegated to those members of the current Board of Directors who served immediately prior to 23 August 2018, namely John Hustler and Richard Roth.

The strategies and policies which govern the Investment Manager have been set by the Board in accordance with section 172 of the Companies Act 2006.

Corporate Governance Statement

ISCA Administration Services Limited was appointed as the Corporate Secretary of the Company with effect from 1 October 2021 following the retirement of Mr John Craig Hunter FCG as the Company Secretary, having served the Company for nearly 15 years.

The Board has considered the principles and recommendations of the 2019 AIC Code. The Company’s Corporate Governance policy is set out on pages 46 to 49.

The 2019 AIC Code is available on the AIC website (www.theaic.co.uk). It includes an explanation of how the 2019 AIC Code adapts the Principles and Provisions set out in the UK Corporate Governance Code (the “UK Code”) to make them relevant for investment companies.

The Company has complied with the recommendations of the 2019 AIC Code and the relevant provisions of the UK Code, except as set out below:

• The Company does not have a Chief Executive Officer or a Senior Independent Director. The Board does not consider this necessary as it does not have any executive directors. 
• New Directors do not receive a formal induction on joining the Board, though they do receive one tailored to them on an individual basis.
• The Company conducts a formal review as to whether there is a need for an internal audit function. However, the Directors do not consider that an internal audit would be an appropriate control for this VCT at this time. 
• The Company does not have a Remuneration Committee as it does not have any executive directors.
• The Company does not have a Nomination Committee as these matters are dealt with by the Board.

For the reasons set out in the AIC Guide, and as explained in the UK Corporate Governance Code, the Board considers the above provisions are not relevant to the position of the Company, being an investment company run by the Board and managed by the Investment Manager. In particular, all of the Company’s day-to-day administrative functions are outsourced to third parties. As a result, the Company has no executive directors, employees or internal operations.

Directors

Biographical details of the Directors are shown on page 40. of the Annual Report 

In accordance with the Articles of Association and good governance, all four Directors will retire and offer themselves for re-election at the forthcoming AGM.

The Board is satisfied that, following individual performance appraisals, the Directors who are retiring continue to be effective and demonstrate commitment to their roles and therefore offer themselves for re-election with the support of the Board. Further details regarding the Company’s succession planning are set out in the Corporate Governance policy on pages 46 to 49.

The Board did not identify any conflicts of interest between the Chairman’s interest and those of the shareholders, especially with regard to the relationship between the Chairman and the Investment Manager.

No concerns about the operation of the Board or the Company were raised by any Director during the period and had any been raised they would be mentioned in the minutes or in writing to the Chairman to be circulated to the Board in accordance with Provision 5.2 of the 2019 AIC Code.

The Board is cognisant of shareholders’ preference for Directors not to sit on the boards of too many listed companies (“over-boarding”). The Board is satisfied that all Directors have the time to focus on the requirements of the Company.

International Financial Reporting Standards

As the Company is not part of a group it is not mandatory for it to comply with International Financial Reporting Standards (“IFRS”). The Company does not anticipate that it will voluntarily adopt IFRS. The Company has adopted Financial Reporting Standard 102 – The Financial Reporting Standard Applicable in the United Kingdom and the Republic of Ireland.

Environmental, Social and Governance (“ESG”) Practices

The Board recognises the requirement under section 414c of the Companies Act 2006 to detail information about environmental matters (including the impact of the Company’s business on the environment), employee and human rights, social and community issues, including information about any policies it has in relation to these matters and effectiveness of these policies.

Given the size and nature of the Company’s activities and the fact that it has no employees and only four non-executive Directors, the Board considers there is limited scope to develop and implement environmental, social and community policies, but recognises the importance of including consideration for such matters in investment decisions. The Board has taken into account the requirement of section 172(1) of the Companies Act 2006 and the importance of ESG matters when making decisions which could impact shareholders, stakeholders and the wider community. The Company’s Section 172(1) statement has been provided in the Strategic Report on page 8, where the Directors consider the information to be of strategic importance to the Company.

The Company seeks to ensure that its business is conducted in a manner that is responsible to the environment. The management and administration of the Company is undertaken by the Investment Manager who recognises the importance of its environmental responsibilities, monitors its impact on the environment and implements policies to reduce any negative environmental impact and which promote environmental sustainability.

Whilst the Investment Manager is registered as a small AIFM and is therefore subject to reduced requirements under the Alternative Investment Fund Manager’s Regulations 2013 (SI 2013/1773), Seneca recognises that managing investments on behalf of clients involves taking into account a wide set of responsibilities, in addition to seeking to maximise financial returns for investors. Industry practice in this area has been evolving rapidly and the Company seeks to be an active participant by working to define and strengthen its principles accordingly. This involves both integrating ESG considerations into the Investment Manager’s investment decision-making process as a matter of course, and also considering guidance issued by external bodies who are leading influencers in the formation of industry best practice. The following is an outline of the kinds of ESG considerations that the Investment Manager is taking into account as part of its investment process.

EnvironmentalSeneca, as part of its commercial due diligence practices and ongoing monitoring, examines potential issues which could arise from supply chains, climate change and environmental policy compliance. The Investment Manager looks for management teams who are aware of the issues and are proactive in responding to them.

SocialSeneca seeks to avoid unequivocal social negatives, such as profiting from forced labour within its investment portfolio and to support positive impacts which will more likely find support from customers and see rising demand. Seneca does not tolerate modern slavery or human trafficking within its business operations and takes a risk-based approach in respect of our portfolio companies. Seneca actively engages with portfolio companies and their boards to discuss material risks, ranging from business and operational risks to environmental and social risks.

GovernanceSeneca examines and, where appropriate, engages with companies on board membership, remuneration, conflicts of interest such as related party transactions, and business leadership and culture. In addition, the Company, as a matter of course, exercises its voting rights when possible.

Greenhouse Gas (“GHG”) Emissions and Streamlined Energy & Carbon Reporting (“SECR”)

Under the Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013 (‘the 2013 Regulations’) and the Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018, quoted companies of any size are required under Part 15 of the Companies Act 2006 to disclose information relating to their energy use and GHG emissions.

All of the Company’s activities are outsourced to third parties. The Company therefore has no greenhouse gas emissions to report from its operations, nor does it have direct responsibility for any other emissions producing sources under the Companies Act 2006 (Strategic Report and Directors’ Reports) Regulations 2013 and the Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018. For the same reasons as set out above, the Company considers itself to be a low energy user under the SECR regulations and therefore is not required to disclose energy and carbon information. A low energy user is defined as an organisation that uses 40 MWh or less during the reporting period. 

Going Concern

The Company’s business activities and the factors likely to affect its future performance and financial position are set out in the Chairman’s Statement and Investment Manager’s Report on pages 9 to 12 and pages 14 to 33. Further details on the management of the principal risks are set out on pages 37 to 38 and financial risks may be found in Note 16 to the Financial Statements.

The Board receives regular reports from Seneca which acts as both the Investment Manager and the Administration Manager, and the Directors believe that, as no material uncertainties leading to significant doubt about going concern have been identified, it is appropriate to continue to adopt the going concern basis in preparing the Financial Statements.

The assets of the Company consist mainly of securities, ten of which are AIM quoted, relatively liquid and readily accessible, as well as more than £7 million of cash as at 31 December 2021 (40% of net assets). After reviewing the Company’s forecasts and expectations, the Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. The Company therefore continues to adopt the going concern basis in preparing its Financial Statements.

The Company is also facing risks from macro-economic conditions resulting from the Covid-19 pandemic and the UK’s exit from the European Union. The Company’s Board and Investment Manager are focused on ensuring that investee companies are taking the required actions to minimise the potential impact that these conditions could have on them. The Board and Seneca will continue to review these potential risks and keep those risks under regular review but do not consider either Brexit or the pandemic to have any impact on the Company’s own ability to continue as a going concern.

Share Capital

As disclosed on page 96 the Board has authority to make market purchases of the Company’s own B shares. No shares were purchased by the Company during the year (2020: nil).

At the last AGM held on 29 March 2021, the Board received authority to allot up to 35,000,000 B shares in connection with any offer(s) for subscription (and any subsequent top up offer of B shares) and up to 405,800 Ordinary shares (for any miscellaneous offers of such shares), which represented approximately 386% of the Company’s issued B share capital and approximately 5% of its issued Ordinary share capital as at 19 February 2021.

During the year, the Company did not issue any Ordinary shares (2020: nil). During the year, the Company issued 5,525,711 B shares raising £5.7 million before expenses (2020: 2,701,500 shares and £2.4 million). No further shares have been issued between 31 December 2021 and the date of this report.

The Company’s issued Ordinary share capital as at 31 December 2021 was 8,115,376 Ordinary shares of 1p each (31 December 2020: 8,115,376 Ordinary shares of 1p each) and 14,588,659 B shares of 1p each (31 December 2020: 9,062,948 B shares of 1p each). 

The total number of shares in issue for both the Ordinary shares and B shares of 1p each as at 31 December 2021 and 23 March 2022 was 22,704,035 (31 December 2020: 17,178,324) with each share having one vote.

In accordance with Schedule 7 of the Large and Medium Size Companies and Groups (Accounts and Reports) Regulations 2008, as amended, the Directors disclose the following information:

• The Company’s capital structure and voting rights are summarised above, and there are no restrictions on voting rights nor any agreement between holders of securities that result in restrictions on the transfer of securities or on voting rights;
• There exist no securities carrying special rights with regard to the control of the Company;
• The rules concerning the appointment and replacement of directors, amendment of the Articles of Association and powers to issue or buy back of the Company’s shares are contained in the Articles of Association of the Company and the Companies Act 2006;
• The Company does not have an employee share scheme;
• There are no agreements to which the Company is party that may affect its control following a takeover bid; and
• There are no agreements between the Company and its Directors providing for compensation for loss of office that may occur following a takeover bid or for any other reason, apart from their normal notice period and any fees potentially due under the performance fee arrangements set out on page 54 and Note 6.

Substantial Shareholdings

At 31 December 2021 and at the date of this report, there was one holding of 3% and over of the Company’s ordinary share capital of which we had been notified. This holding related to Mr and Mrs Ian William Currie and amounted to 3.01%.

Annual General Meeting

The Notice convening the 2022 AGM of the Company is set out at the end of this document (and a form of proxy in relation to the meeting is enclosed separately). Part of the business of the AGM will be to consider resolutions in relation to the following matters:

Resolution 1 will seek the approval of the Directors’ Annual Report and Financial Statements and the auditors’ report thereon for the year ended 31 December 2021. The Directors are obliged to lay the Directors’ Annual Report and Financial Statements and the auditors’ report thereon for the year ended 31 December 2021 before shareholders at a general meeting.

Resolution 2 seeks shareholder approval of the Directors’ Remuneration Report 2021 (excluding the Directors’ Remuneration Policy) which gives details of the Directors' remuneration for the financial year ended 31 December 2021 and which is set out on pages 54 to 57 of the Directors’ Annual Report and Financial Statements for financial year ended 31 December 2021. In line with legislation, this vote will be advisory and the Directors’ entitlement to remuneration is not conditional on the resolution being passed.

Resolution 3 seeks shareholder approval of the Directors’ Remuneration Policy which is set out in full on pages 56 to 57 of the Directors’ Remuneration Report contained within the Directors’ Annual Report and Financial Statements for financial year ended 31 December 2021. Once the policy is approved the Company will not be able to make a remuneration payment to a current or prospective director or a payment for loss of office to a current or past director, unless the payment is consistent with the policy or has been approved by a resolution of the shareholders of the Company.

Resolutions 4 to 7 will seek the re-election of the existing four members of the Board as non-executive Directors of the Company.

Resolution 8 will authorise the Directors to allot further B shares and Ordinary shares. This will enable the Directors until the next AGM to allot up to 35,000,000 B shares in connection with any offer(s) for subscription (and any subsequent top up offer of B shares) and up to 405,800 Ordinary shares (for any miscellaneous offers of such shares), representing approximately 240% of the Company’s issued B share capital and approximately 5% of its issued Ordinary share capital as at 23 March 2022.

Resolution 9 will authorise the Board, pursuant to the Act, to make one or more market purchases of up to 14.99% of the issued B share capital of the Company from time to time. The price paid must not be less than 1p per B share, nor more than 5% above the average middle market price of a B share for the preceding five business days. Any B shares bought back under this authority may be cancelled by the Board.

Resolution 10 will, under sections 570 of the Act, disapply pre-emption rights in respect of any allotment of the B shares and/or Ordinary shares authorised under Resolution 8.

The Directors intend to use the authorities in Resolutions 8 and 10 for the purposes of the current Offer and a further offer for subscription of B shares. The Directors have no current intention to utilise the authority in relation to the Ordinary shares.

Copies of the Articles of Association of the Company will be available for inspection at the registered office of the Company during usual business hours on any weekday (Saturday and Public Holidays excluded) from the date of this notice, until the end of the Annual General Meeting and at the place of the Annual General Meeting for at least 15 minutes prior to and during the meeting. The Articles of Association will also be available on the Company’s website at https://senecavct.co.uk/reports-documents/.

Recommendation

The Board believes that the passing of the resolutions above are in the best interests of the Company and its shareholders as a whole and unanimously recommends that you vote in favour of these resolutions as the Directors intend to do in respect of their beneficial shareholdings.

By Order of the Board

ISCA Administration Services LimitedCompany Secretary24 March 2022

Combined Income Statement

		CombinedYear to 31 December 2021			CombinedYear to 31 December 2020
		Revenue	Capital	Total	Revenue	Capital	Total
	Note	£’000	£’000	£’000	£’000	£’000	£’000
Gain on disposal of fixed asset investments		-	1,027	1,027	-	948	948
Gain on valuation of fixed asset investments		-	1,609	1,609	-	682	682
Income	2	-	-	-	-	-	-
Performance fee	6	-	(158)	(158)	-	(140)	(140)
Investment management fee net of cost cap	3	(53)	(158)	(211)	(10)	(31)	(41)
Other expenses	4	(171)	-	(171)	(150)	(2)	(152)
Return on ordinary activities before tax		(224)	2,320	2,096	(160)	1,457	1,297
Taxation on return on ordinary activities	7	-	-	-	-	-	-
Return on ordinary activities after tax		(224)	2,320	2,096	(160)	1,457	1,297
Return on ordinary activities after tax attributable to:
Owners of the fund		(244)	2,320	2,096	(160)	1,457	1,297

There was no other Comprehensive Income recognised during the year.

1. The ‘Total’ column of the income statement and statement of comprehensive income is the profit and loss account of the Company; the supplementary revenue return and capital return columns have been prepared under guidance published by the Association of Investment Companies.
2. All revenue and capital items in the above statement derive from continuing operations.
3. The Company has only one class of business and derives its income from investments made in shares and securities and from bank and money market funds.
4. The Company has two share classes, the Ordinary share and B share class.

The Company has no recognised gains or losses other than the results for the year as set out above.

The accompanying notes are an integral part of the Financial Statements.

Ordinary Share Income Statement(non-statutory analysis)

			Ordinary sharesYear to 31 December 2021			Ordinary sharesYear to 31 December 2020
			Revenue	Capital	Total	Revenue	Capital	Total
	Note		£’000	£’000	£’000	£’000	£’000	£’000
Gain on disposal of fixed asset investments			-	82	82	-	720	720
Gain on valuation of fixed asset investments	10		-	1,121	1,121	-	467	467
Income	2		-	-	-	-	-	-
Performance fee	6		-	(158)	(158)	-	(140)	(140)
Investment management fee	3		-	-	-	-	-	-
Other expenses	4		(16)	-	(16)		(2)	(2)
Return on ordinary activities before tax			(16)	1,045	1,029	-	1,045	1,045
Taxation on return on ordinary activities	7		-	-	-	-	-	-
Return on ordinary activities after tax			(16)	1,045	1,029	-	1,045	1,045
Return on ordinary activities after tax attributable to:
Ordinary shareholders			(16)	1,045	1,029	-	1,045	1,045
Earnings per share – basic and diluted	8		(0.2)p	12.8p	12.6p	0.0p	12.8p	12.8p

B Share Income Statement (non-statutory analysis)

		B sharesYear to 31 December 2021			B sharesYear to 31 December 2020
		Revenue	Capital	Total	Revenue	Capital	Total
	Note	£’000	£’000	£’000	£’000	£’000	£’000
Gain on disposal of fixed asset investments		-	945	945	-	228	228
Gain on valuation of fixed asset investments	10	-	488	488	-	215	215
Income	2	-	-	-	-	-	-
Performance fee	6	-	-	-	-	-	-
Investment management fee net of cost cap	3	(53)	(158)	(211)	(10)	(31)	(41)
Other expenses	4	(155)	-	(155)	(150)	-	(150)
Return on ordinary activities before tax		(208)	1,275	1,067	(160)	412	252
Taxation on return on ordinary activities	7	-	-	-	-	-	-
Return on ordinary activities after tax		(208)	1,275	1,067	(160)	412	252
Return on ordinary activities after tax attributable to:
B shareholders		(208)	1,275	1,067	(160)	412	252
Earnings per share – basic and diluted	8	(1.7)p	10.6p	8.9p	(2.2)p	5.7p	3.5p

Combined Statement of Changes in Equity

	Share capital	Sharepremium	Special distributable reserve	Capital reserve realised gains/(losses)	Capital reserve holding gains/(losses)	Revenue reserve	Total
	£’000	£’000	£’000	£’000	£’000	£’000	£’000
Balance as at 1 January 2020	145	2,806	8,395	1,196	(2,061)	(2,097)	8,384
B share issue	27	2,363	-	-	-	-	2,390
Revenue return on ordinary activities after tax	-	-	-	-	-	(160)	(160)
Expenses charged to capital	-	-	-	(33)	-	-	(33)
Performance fee allocated as capital expenditure	-	-	-	(140)	-	-	(140)
Dividends paid	-	-	(1,301)	-	-	-	(1,301)
Current period gains on disposal	-	-	-	948	-	-	948
Current period gains on fair value of investments	-	-	-	-	682	-	682
Prior years' unrealised losses now realised	-	-	-	(267)	267	-	-
Balance as at 31 December 2020	172	5,169	7,094	1,704	(1,112)	(2,257)	10,770
B share issue	55	5,569	-	-	-	-	5,624
Revenue return on ordinary activities after tax	-	-	-	-	-	(224)	(224)
Expenses charged to capital	-	-	-	(158)	-	-	(158)
Performance fee allocated as capital expenditure	-	-	-	(158)	-	-	(158)
Dividends paid	-	-	(727)	-	-	-	(727)
Current period gains on disposal	-	-	-	1,027	-	-	1,027
Current period gains on fair value of investments	-	-	-	-	1,609	-	1,609
Prior years' unrealised profits now realised	-	-	-	224	(224)	-	-
Balance as at 31 December 2021	227	10,738	6,367	2,639	273	(2,481)	17,763

The accompanying notes are an integral part of the Financial Statements.

Ordinary Shares - Statement of Changes in Equity (non-statutory analysis)

	Share capital	Sharepremium	Special distributable reserve	Capital reserve realised gains/(losses)	Capital reserve holding gains/(losses)	Revenue reserve	Total
	£’000	£’000	£’000	£’000	£’000	£’000	£’000
Balance as at 1 January 2020	81	-	5,140	1,221	(2,034)	(1,945)	2,463
Revenue return on ordinary activities after tax	-	-	-	-	-	-	-
Expenses charged to capital				(2)	-	-	(2)
Performance fee allocated as capital expenditure	-	-	-	(140)	-	-	(140)
Dividends paid	-	-	(1,055)		-	-	(1,055)
Current period gains on disposal	-	-	-	720	-	-	720
Current period gains on fair value of investments	-	-	-		467	-	467
Prior years’ unrealised losses now realised	-	-	-	(267)	267	-	-
Balance as at 31 December 2020	81	-	4,085	1,532	(1,300)	(1,945)	2,453
Revenue return on ordinary activities after tax	-	-	-	-	-	(16)	(16)
Expenses charged to capital	-	-	-	-	-	-	-
Performance fee allocated as capital expenditure	-	-	-	(158)	-	-	(158)
Dividends paid	-	-	(325)	-	-	-	(325)
Current period gains on disposal	-	-	-	82	-	-	82
Current period gains on fair value of investments	-	-	-	-	1,121	-	1,121
Prior years' unrealised profits now realised	-	-	-	75	(75)	-	-
Balance as at 31 December 2021	81	-	3,760	1,531	(254)	(1,961)	3,157

B Shares - Statement of Changes in Equity(non-statutory analysis)

	Share capital	Sharepremium	Special distributable reserve	Capital reserve realised gains/(losses)	Capital reserve holding gains/(losses)	Revenue reserve	Total
	£’000	£’000	£’000	£’000	£’000	£’000	£’000
Balance as at 1 January 2020	64	2,806	3,255	(25)	(27)	(152)	5,921
B share issue	27	2,363	-	-	-	-	2,390
Revenue return on ordinary activities after tax	-	-	-	-	-	(160)	(160)
Expenses charged to capital	-	-	-	(31)	-	-	(31)
Dividends paid	-	-	(246)	-	-	-	(246)
Current period gains on disposal	-	-	-	228	-	-	228
Current period gains on fair value of investments	-	-	-	-	215	-	215
Prior years’ unrealised profits now realised	-	-	-	-	-	-	-
Balance as at 31 December 2020	91	5,169	3,009	172	188	(312)	8,317
B share issue	55	5,569	-	-	-	-	5,624
Revenue return on ordinary activities after tax	-	-	-	-	-	(208)	(208)
Expenses charged to capital	-	-	-	(158)	-	-	(158)
Dividends paid	-	-	(402)	-	-	-	(402)
Current period gains on disposal	-	-	-	945	-	-	945
Current period gains on fair value of investments	-	-	-	-	488	-	488
Prior years’ unrealised profits now realised	-	-	-	149	(149)	-	-
Balance as at 31 December 2021	146	10,738	2,607	1,108	527	(520)	14,606

Combined Balance Sheet

		Combined as at31 December 2021			Combined as at31 December 2020
	Note	£'000	£'000		£'000		£'000
Fixed asset investments*	10			11,165			6,123
Current assets:
Debtors	11	9			7
Cash and cash equivalents		7,105			5,056
Creditors: amounts falling due within one year	12	(165)			(223)
Net current assets				6,949			4,840
Creditors: amounts falling due after more than one year	12	(351)			(193)
Net assets				17,763			10,770
Called up equity share capital	13			227			172
Share premium	14			10,738			5,169
Special distributable reserve	14			6,367			7,094
Capital reserve – realised gains and losses	14			2,639			1,704
– holding gains and losses	14			273			(1,112)
Revenue reserve	14			(2,481)			(2,257)
Total equity shareholders' funds				17,763			10,770

*At fair value through profit and loss

The accompanying notes are an integral part of the Financial Statements.

The statements were approved by the Directors and authorised for issue on 22 February 2021 and are signed on their behalf by:

John HustlerChairmanCompany No: 04221489

Ordinary Share Balance Sheet(non-statutory analysis)
		Ordinary shares as at31 December 2021		Ordinary shares as at31 December 2020
	Note	£'000	£'000	£'000	£'000
Fixed asset investments*	10		3,212		2,141
Current assets:
Debtors	11	-		-
Cash and cash equivalents		318		527
Creditors: amounts falling due within one year	12	(22)		(22)
Net current assets			296		505
Creditors: amounts falling due after more than one year	12	(351)		(193)
Net assets			3,157		2,453
Called up equity share capital	13		81		81
Share premium			-		-
Special distributable reserve			3,760		4,085
Capital reserve – realised gains and losses			1,531		1,532
– holding gains and losses			(254)		(1,300)
Revenue reserve			(1,961)		(1,945)
Total equity shareholders' funds			3,157		2,453
Net asset value per share	9		38.9p		30.2p

*At fair value through profit and loss

B Share Balance Sheet (non-statutory analysis)
		B shares as at31 December 2021		B shares as at31 December 2020
	Note	£'000	£'000	£'000	£'000
Fixed asset investments*	10		7,953			3,982
Current assets:
Debtors	11	9		7
Cash and cash equivalents		6,787		4,529
Creditors: amounts falling due within one year	12	(143)		(201)
Net current assets			6,653			4,335
Creditors: amounts falling due after more than one year	12	-		-
Net assets			14,606			8,317
Called up equity share capital	13		146			91
Share premium			10,738			5,169
Special distributable reserve			2,607			3,009
Capital reserve – realised gains and losses			1,108			172
– holding gains and losses			527			188
Revenue reserve			(520)			(312)
Total equity shareholders' funds			14,606			8,317
Net asset value per share	9		100.1p			91.8p

*At fair value through profit and loss

Combined Statement of Cash Flows

	Note	Combined Year to31 December 2021£'000	Combined Year to31 December 2020£'000
Cash flows from operating activities
Return on ordinary activities before tax		2,096	1,297
Adjustments for:
Increase in debtors	11	(2)	(4)
Increase in creditors	12	254	143
Gain on disposal of fixed asset investments		(1,027)	(948)
Gain on valuation of fixed asset investments		(1,609)	(682)
Cash from operations		(288)	(194)
Income taxes paid	7	-	-
Net cash used in operating activities		(288)	(194)
Cash flows from investing activities
Purchase of fixed asset investments	10	(4,613)	(1,360)
Sale of fixed asset investments	10	2,207	1,628
Total cash (outflow)/inflow from investing activities		(2,406)	268
Cash flows from financing activitiesDividend paid		(727)	(1,301)
Issue of B shares		5,624	2,390
Awaiting B share issue	12	(154)	(16)
Total cash inflow from financing activities		4,743	1,073
Increase in cash and cash equivalents		2,049	1,147
Opening cash and cash equivalents		5,056	3,909
Closing cash and cash equivalents		7,105	5,056

                                                                The accompanying notes are an integral part of the Financial Statements.

Ordinary Shares Statement of Cash Flows(non-statutory analysis)

	Note	Ordinary sharesYear to 31 December 2021£'000	Ordinary shares Year to 31 December 2020£'000
Cash flows from operating activities
Return on ordinary activities before tax		1,029	1,045
Adjustments for:
(Increase)/decrease in debtors		-	-
Increase in creditors		158	140
Gain on disposal of fixed asset investments		(82)	(720)
Gain on valuation of fixed asset investments	10	(1,121)	(467)
Cash from operations		(16)	(2)
Income taxes paid	7	-	-
Net cash used in operating activities		(16)	(2)
Cash flows from investing activities
Purchase of fixed asset investments	10	(85)	-
Sale of fixed asset investments	10	217	1,114
Total cash inflow from investing activities		132	1,114
Cash flows from financing activitiesDividend paid		(325)	(1,055)
Total cash outflow from financing activities		(325)	(1,055)
(Decrease)/increase in cash and cash equivalents		(209)	57
Opening cash and cash equivalents		527	470
Closing cash and cash equivalents		318	527

The accompanying notes are an integral part of the Financial Statements.

B Shares Statement of Cash Flows(non-statutory analysis)

	Note	B sharesYear to 31 December 2021£'000	B shares Year to 31 December 2020£'000
Cash flows from operating activities
Return on ordinary activities before tax		1,067	252
Adjustments for:
Increase in debtors		(2)	(4)
Increase in creditors		96	3
Gain on disposal of fixed asset investments		(945)	(228)
Gain on valuation of fixed asset investments	10	(488)	(215)
Cash from operations		(272)	(192)
Income taxes paid	7	-	-
Net cash used in operating activities		(272)	(192)
Cash flows from investing activities
Purchase of fixed asset investments	10	(4,528)	(1,360)
Sale of fixed asset investments	10	1,990	514
Total cash outflow from investing activities		(2,538)	(846)
Cash flows from financing activitiesDividend paid		(402)	(246)
Issue of B shares		5,624	2,390
Awaiting B share issue	12	(154)	(16)
Total cash inflow from financing activities		5,068	2,128
Increase in cash and cash equivalents		2,258	1,090
Opening cash and cash equivalents		4,529	3,439
Closing cash and cash equivalents		6,787	4,529

Notes to the Financial Statements

1. Principal Accounting Policies

Basis of preparationThe Financial Statements have been prepared under the historical cost convention, except for the measurement at fair value of certain financial instruments, and in accordance with UK Generally Accepted Accounting Practice (“GAAP”), including FRS 102 and with the Companies Act 2006 and the Statement of Recommended Practice (SORP) ‘Financial Statements of Investment Trust Companies and Venture Capital Trusts (revised 2021)’.

The principal accounting policies have remained materially unchanged from those set out in the Company’s 2020 Annual Report and Financial Statements. A summary of the principal accounting policies is set out below.

The Company is a public company and is limited by shares. The Company held all fixed asset investments at fair value through profit or loss. Accordingly, all interest income, fee income, expenses and gains and losses on investments are attributable to assets held at fair value through profit or loss.

The most important policies affecting the Company’s financial position are those related to investment valuation and require the application of subjective and complex judgements, often as a result of the need to make estimates about the effects of matters that are inherently uncertain and may change in subsequent periods. These are discussed in more detail below.

Going ConcernThe assets of the Company consist mainly of securities, ten of which are AIM quoted (2020: four), quite liquid and readily accessible, as well as cash. As at 31 December 2021, 40% of net assets was cash (2020: 47%). After reviewing the Company’s forecasts and expectations, the Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. The Company therefore continues to adopt the going concern basis in preparing its Financial Statements.

In addition to the above, the Company expects Covid-19 to continue to have an impact on economic conditions globally. It may adversely affect the performance of some companies in which the Company has invested or may invest. The Board and Seneca will continue to review risks posed by Covid-19 and keep those risks under regular review.

Key judgements and estimatesThe preparation of the Financial Statements requires the Board to make judgements and estimates regarding the application of policies affecting the reported amounts of assets, liabilities, income and expenses. Estimates and assumptions mainly relate to the fair valuation of the fixed asset investments particularly unquoted investments. Estimates are based on historical experience and other assumptions that are considered reasonable under the circumstances. The estimates and the assumptions are under continuous review with particular attention paid to the carrying value of the investments.

Investments are regularly reviewed to ensure that the fair values are appropriately stated. Unquoted investments are valued in accordance with current International Private Equity and Venture Capital Valuation (IPEV) guidelines, which can be found on their website at www.privateequityvaluation.com, although this does rely on subjective estimates such as appropriate sector earnings or revenue multiples, forecast results of investee companies, asset values of investee companies and liquidity or marketability of the investments held. The material factors affecting the returns and net assets attributable to shareholders of the different share classes are the valuations of the Ordinary and B share pools and ongoing general expenses.

Although the Directors believe that the assumptions concerning the business environment and estimate of future cash flows are appropriate, changes in estimates and assumptions could result in changes in the stated values. This could lead to additional changes in fair value in the future.

Functional and presentational currencyThe Financial Statements are presented in Sterling (£). The functional currency is also Sterling (£).

Cash and cash equivalentsCash and cash equivalents includes cash in hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less and bank overdrafts.

Fixed asset investmentsThe Company’s principal financial assets are its investments and the policies in relation to those assets are set out below.

Purchases and sales of investments are recognised in the Financial Statements at the date of the transaction (trade date).

These investments will be managed and their performance evaluated on a fair value basis and information about them is provided internally on that basis to the Board. Accordingly, as permitted by FRS 102, the investments are measured as being fair value through profit or loss on the basis that they qualify as a group of assets managed, and whose performance is evaluated, on a fair value basis in accordance with a documented investment strategy. The Company's investments are measured at subsequent reporting dates at fair value.

In the case of investments quoted on a recognised stock exchange, fair value is established by reference to the closing bid price on the relevant reporting date or the last traded price, depending upon convention of the exchange on which the investment is quoted. In the case of AIM quoted investments this is the closing bid price. In the case of unquoted investments, fair value is established by using measures of value such as the price of recent transactions, earnings or revenue multiples, discounted cash flows and net assets. These are consistent with the IPEV guidelines.

Gains and losses arising from changes in fair value of investments are recognised as part of the capital return within the Income Statement and allocated to the capital reserve - holding gains/(losses).

In the preparation of the valuations of assets the Directors are required to make judgements and estimates that are reasonable and incorporate their knowledge of the performance of the investee companies.

Fair value hierarchyParagraph 34.22 of FRS 102 regarding financial instruments that are measured in the balance sheet at fair value requires disclosure of fair value measurements dependent on whether the stock is quoted and the level of the accuracy in the ability to determine its fair value. The fair value measurement hierarchy is as follows:

For quoted investments:

Level 1: quoted prices in active markets for an identical asset. The fair value of financial instruments traded in active markets is based on quoted market prices at the balance sheet date. A market is regarded as active if quoted prices are readily and regularly available, and those prices represent actual and regularly occurring market transactions on an arm’s length basis. The quoted market price used for financial assets held is the bid price at the Balance Sheet date.

Level 2: where quoted prices are not available (or where a stock is normally quoted on a recognised stock exchange that no quoted price is available), the price of a recent transaction for an identical asset, providing there has been no significant change in economic circumstances or a significant lapse in time since the transaction took place. The Company held no such investments in the current or prior year.

For investments not quoted in an active market:Level 3: the fair value of financial instruments that are not traded in an active market is determined by using valuation techniques. These valuation techniques maximise the use of observable data (e.g.: the price of recent transactions, earnings/revenue multiple, discounted cash flows and/or net assets) where it is available and rely as little as possible on entity specific estimates.

There was one transfer between these classifications in the year with the IPO of Arecor (2020: none). The change in fair value for the current and previous year is recognised through the profit and loss account.

Current asset investmentsNo current asset investments were held at 31 December 2021 or 31 December 2020. Should current assets be held, gains and losses arising from changes in fair value of investments are recognised as part of the capital return within the Income Statement and allocated to the capital reserve - gains/(losses) on disposal.

IncomeInvestment income includes interest earned on bank balances and from unquoted loan note securities, and dividends. Fixed returns on debt are recognised on a time apportionment basis so as to reflect the effective yield, provided it is probable that payment will be received in due course.

The Company has not generated any income in 2021 (2020: £nil).

ExpensesAll expenses are accounted for on an accruals basis. Expenses are charged wholly to revenue with the exception of the performance and management fee. The performance fee is charged 100% to the capital reserve and the investment management fee charged to the B shares has been split 25% revenue and 75% capital, in line with industry practice and to reflect the Board’s estimated split of investment returns which will be achieved by the Company’s B shares over the long term. Expenses and liabilities not specific to a share class were chargeable to the B share pool for a period of three years from 1 July 2018 (subject to the cost cap discussed in Note 3). Since 1 July 2021, expenses are allocated pro-rata between the B shares and Ordinary shares based on their respective net asset values. These costs, including the annual management fee in the case of the B share pool, are capped at 3% of the net asset value of each share class.

Revenue and capitalThe revenue column of the Income Statement includes all income and revenue expenses of the Company. The capital column includes gains and losses on disposal and holding gains and losses on investments, as well as those expenses that have been charged as capital costs. Gains and losses arising from changes in fair value of investments are recognised as part of the capital return within the Income Statement and allocated to the appropriate capital reserve on the basis of whether they are realised or unrealised at the Balance Sheet date.

TaxationCurrent tax is recognised for the amount of income tax payable in respect of the taxable profit for the current or past reporting periods using the applicable tax rate. The tax effect of different items of income/gain and expenditure/loss is allocated between capital and revenue return on the "marginal" basis as recommended in the SORP.

Deferred tax is recognised on an undiscounted basis in respect of all timing differences that have originated but not reversed at the balance sheet date, except as otherwise indicated.

Deferred tax assets are only recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Financial instrumentsThe Company’s principal financial assets are its investments and its cash and the policies in relation to those assets are set out above. Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the entity after deducting all of its financial liabilities. Where the contractual terms of share capital do not have any terms meeting the definition of a financial liability then this is classed as an equity instrument.

Capital management is monitored and controlled using the internal control procedures set out on page 48 of this report. The capital being managed includes equity and fixed-interest investments, cash balances and liquid resources including debtors and creditors.

The Company does not have any externally imposed capital requirements.

ReservesCalled up equity share capital represents the nominal value of shares that have been issued.

Share premium account includes any premiums received on issue of share capital. Any transaction costs associated with the issuing of shares are deducted from share premium.

Special distributable reserve includes cancelled share premium and capital redemption reserves available for distribution and may be used to cover dividend payments.

Capital reserve – holding gains and losses created when the Company revalues the investments still held during the period with any gains or losses arising being credited/ charged to the Capital reserve.

Capital reserve – gains and losses on disposal created when an investment is sold. Any balance held in the Capital reserve – holding gains and losses is transferred to the Capital reserve – realised gains and losses on disposal and recognised as a movement in reserves.

Revenue reserve – represents the aggregate value of accumulated realised profits (excluding capital profits), less losses and dividends.

Dividends PayableDividends payable are recognised as distributions in the Financial Statements when the Company’s liability to make payment has been established. This liability is established for interim dividends when they are declared by the Board, and for final dividends when they are approved by shareholders.

1. Income

	Year to 31 December 2021	Year to 31 December 2020
	£’000	£’000
Dividends received	-	-
	-	-

Investment income includes interest earned on bank balances and dividends.

The Company has not generated any income in the period and as such we have not included any segmental reporting. In the event the Company had generated income, we would disclose information about the Company’s operating segments and the geographical areas in which they operate, which is currently in the United Kingdom.

1. Investment Management Fees for B shares

		Year to 31 December 2021£’000	Year to 31 December 2020£’000
Gross investment management fee		246	127
Cost cap refund from Seneca		(35)	(86)
Investment management fee net of cost cap		211	41

Seneca is entitled to an annual management fee of 2% of the weighted net asset value of the B share pool (2020: 2%) and, with effect from 1 August 2019, is also entitled to an annual fee of £9,000 (plus VAT, if applicable) in relation to management accounting services. These fees are payable quarterly in arrears. Seneca will also be entitled to certain monitoring fees from investee companies and the Board reviews the amounts (please see Note 19).

Seneca is also entitled to receive a performance related incentive fee (the “Performance Incentive Fee”) in relation to the B share pool of an amount equal to 20% of the shareholder proceeds arising, provided that the payment of such a fee shall also be conditional upon (i) a return being generated on the B share pool for B shareholders in respect of that performance period of more than 5% per annum (pro-rated if that period is less than a year) and (ii) that such a return calculated for the period from 23 August 2018 to the end of the relevant performance period exceeds 5% per annum.

Shareholder proceeds are all amounts paid by way of dividend or other distributions, share buy backs, proceeds on a sale or liquidation of the Company in relation to the B shares and calculated on a per share basis, and any other proceeds or value received or deemed to be received by the holders of the relevant shares (excluding any income tax relief on subscription).

For the avoidance of doubt, no Performance Incentive Fee will be payable to the extent that the shareholder proceeds paid by the Company to the holders of the B shares have been justified by reference to distributable reserves otherwise attributable to the Ordinary share pool (as permitted in accordance with the Articles).

For a three-year period with effect from 1 July 2018, expenses of the Company were capped at 3% of the weighted average net asset value of the B shares, including the management fee (but excluding any performance fee). Since 1 July 2021, expenses have been capped at 3% across both the Ordinary share pool and the B share pool pro-rata to their respective net asset values.

The Investment Manager will indemnify the Company for any excess over the cost cap, with an amount equal to such excess either being paid by Seneca to the Company or refunded by way of a reduction to its fees. Accordingly, Seneca reduced its management fee by £35,000 in the year to 31 December 2021 (2020: reduced by £86,000).

Expenses are charged wholly to revenue with the exception of the (net) investment management fee which has been charged 75% to the capital reserve in line with industry practice and the performance fee.

1. Other Expenses

	Year to 31 December 2021	Year to 31 December 2020
	£'000	£'000
Directors’ remuneration and social security costs	57	50
Fees payable to the Company’s auditor for the audit of the Financial Statements	23	22
Legal and professional expenses	51	59
Accounting and administration services	17	7
Other expenses (revenue)	23	12
Other expenses (capital)	-	2
	171	152

All expenses were charged to the Ordinary shares for the period to 30 June 2018. In line with the offer for subscription for B shares, and following the initial allotment of B shares on 23 August 2018, all the Company’s general expenses are chargeable to the B share pool for a period of three years from 1 July 2018 (subject to the cost cap discussed in Note 3). Since 1 July 2021, expenses have been capped at 3% across both the Ordinary share pool and the B share pool pro-rata to their respective net asset values. Any expenditure related specifically to assets in one pool is chargeable to that pool.

1. Directors’ Remuneration

	Year to31 December 2021	Year to 31 December 2020
	£	£
Directors’ emoluments:
John Hustler (Chairman)	15,000	15,000,
Richard Roth	20,000	18,750
Alex Clarkson	15,000	15,000
Richard Manley	3,750	-
	53,750	48,750

Richard Manley, a director of the Investment Manager, previously elected to waive his Director’s fee, until the Company’s operating costs were less than the expenses cost cap. Given the operating costs were less than the cost cap in Q4 2021, Richard Manley started taking his Director fee. This was paid to Seneca.

Apart from the Directors’ fees detailed above, none of the Directors received any other remuneration from the Company during the year.

Directors’ emoluments are exclusive of employers’ National Insurance contributions, which totalled £3,240 (2020: £1,536). Together, the Directors’ remuneration and social security costs totalled £56,990 (2020: £50,286).

Certain Directors may become entitled to receive a share of the performance incentive fee related to the Ordinary share pool as detailed in the Directors’ Remuneration Report on page 54 and in Note 6.

The Company has no employees other than non-executive Directors. The average number of non-executive Directors in the year was four (2020: four).

1. Performance Fees for Ordinary shares

The performance incentive fees are calculated separately on the Ordinary shares and the B shares. Performance incentive fees in relation to the Ordinary shares are potentially payable to past and current members of the CAC. The current members of the CAC are John Hustler and Richard Roth.

The CAC entered into an agreement to take over management of the Company’s investments on 30 July 2007 (the “2007 Agreement”), and at that time, a revised performance incentive scheme was implemented, such that its members would be entitled to 20% of all cash returns above the initial net cost to subscribing shareholders of 80p (the “Accrued Performance Incentive Fee”).

On 7 October 2015, the performance incentive fee structure was further amended as follows. In respect of the period to 31 December 2014, the Accrued Performance Incentive Fee on the Ordinary share class of up to £702,000 shall be payable to James Otter (a former director of the Company who was also a member of the CAC), Charles Breese (a former director of the Company who was also a member of the CAC) and John Hustler, in equal proportions (with the liability to pay a director his share of such fee being extinguished if the fee is due for payment five years after his ceasing to be a member of the CAC. Such extinguished fees are credited back to the Company).

The liability to pay James Otter his share of any potential Accrued Performance Incentive Fee was extinguished on 7 October 2020 - the fifth anniversary of his ceasing to be a member of the CAC. Therefore, the total potential liability for the Company was reduced from £702,000 to £468,000.

As a result of the reduction in the Accrued Performance Incentive Fee by one third, the amount of the Accrued Performance Incentive Fee shall be 16.67% of any dividends and capital distributions returned to shareholders, which in total exceed the sum of 80p per Ordinary share (the "Hurdle"). This includes dividends paid to date on the Ordinary shares, being 69.25p per share. As a result of this, for every £1 potentially distributable in excess of the Hurdle, 80p shall be distributed to shareholders and 13.33p shall be paid as the Accrued Performance Incentive Fee, with 6.67p (being one third of the original 20p) retainable by the Company up until an amount of 114.65p per Ordinary share has been distributed to Ordinary shareholders, after which no further payment is payable in respect of the Accrued Performance Incentive Fee or otherwise under the terms of the 2007 Agreement (as amended). The Accrued Performance Incentive Fee shall be paid at the same time as payments are made to the Ordinary shareholders. All distributions by way of dividends and capital distributions in relation to the Ordinary share class shall count towards the Accrued Performance Incentive Fee and where non-cash dividends are declared, the Company's auditors shall assess their value by reference to a distribution per share. Following payment in full of the Accrued Performance Incentive Fee, a further performance incentive fee may become payable to the CAC in relation to the period after 7 October 2015 (the, “Further Performance Incentive Fee”).

Following the amendment on 7 October 2015, any returns above the 31 December 2014 levels are subject to a further hurdle (the “Further Hurdle”), and the Further Performance Incentive Fee reduces the share to the CAC to 10% of sums returned to Ordinary shareholders by way of dividends and capital distributions of whatever nature, which in total exceed the Further Hurdle (excluding any initial tax relief on the subscription for the Ordinary shares). The "Base Figure" for the Further Hurdle shall be 90.4p per Ordinary share and shall be increased by a sum equal to notional interest thereon, at the rate of 1.467% per quarter from 1 January 2015, compounded with quarterly rests. For the purposes of determining the increase in the Base Figure, the amount on which notional interest is to accrue in each quarter shall be reduced by the amount of all sums returned to Ordinary shareholders by way of dividends and capital distributions in the previous quarter. Shareholders will need to have received distributions of 114.65p per Ordinary share, together with the amount to take account of notional interest as calculated above, before any Further Performance Incentive Fee is payable.

As at 31 December 2021, the Total Gross Return in respect of the Ordinary shares is 112.47p, and so 4.33p per Ordinary share, totalling £351,000 has been accrued as part of this liability (31 December 2020: 97.85p, 2.38p and £193,000 respectively) The movement of £158,000 in the Accrued Performance Incentive Fee has been recognised as capital expenditure in the Ordinary share income statement (2020: £140,000).

Assuming no dividends are paid on the Ordinary shares in 2022, the Total Gross Return would need to exceed 168.3p at 31 December 2022 before any Further Performance Incentive Fee could be due, and at that time, it would be 10% of any dividends or capital distributions made above this threshold. If the Further Performance Incentive Fee is not triggered (as it has not been in this financial year) the Further Hurdle, net of dividends paid, increments by a compound annual growth rate of 6%, applied quarterly as described above.

If the CAC consider it necessary to engage external advisors in support of managing its portfolio, the costs of this will be borne by the Ordinary share pool. The Further Performance Incentive Fee shall be divided among such members of the CAC (past, present and future) who have been members of that committee since the 7 October 2015, on a pro rata basis, linked to the relative amount of time since the date of the 7 October 2015 agreement for which each individual has been a member of the CAC. An individual will not be entitled to payment of any of Further Performance Incentive Fee if he ceased to be a member of the CAC in certain conditions, or ceased to be a member of the CAC more than five years before the payment of any amount of Further Performance Incentive Fee becomes due and any such fees will be credited back to the Company. For the purposes of the Further Performance Incentive Fee, the method of determining distributions will follow that used in calculating the Accrued Performance Incentive Fee.

1. Tax on Ordinary Activities

The corporation tax charge for the period was £nil (2020: £nil).The tax charge is calculated on return on ordinary activities before taxation at the applicable rate of 19.0% (2020: 19.0%)

Current tax reconciliation:	Year to 31 December 2021£’000	Year to 31 December 2020£’000
Return on Ordinary activities before tax	2,096	1,297
Current tax at 19% (2020: 19%)	398	246
Gains/losses not subject to tax	(501)	(310)
Performance fee accrual not tax deductible	30	37
Excess management expenses carried forward	73	27
Total current tax charge and tax on results of ordinary activities	-	-

The company has excess management expenses of £3,279,000 (2020: £2,896,000) to carry forward to offset against future taxable profits.

Approved VCTs are exempt from tax on capital gains within the Company. Since the Directors intend that the Company will continue to conduct its affairs so as to maintain its approval as a VCT, no current deferred tax has been provided in respect of any capital gains or losses arising on the revaluation or disposal of investments.

1. Earnings per Share

The earnings per Ordinary share is based on 8,115,376 (31 December 2020: 8,115,376) shares, being the weighted average number of Ordinary shares in issue during the year, and a return for the year totalling £1,029,000 (31 December 2020: (£1,045,000)).

The earnings per B share is based on 12,002,312 (31 December 2020: 7,248,338) shares, being the weighted average number of B shares in issue during the year, and a return for the year totalling £1,067,000 (31 December 2020: (£252,000)).

There are no potentially dilutive capital instruments in issue and, therefore, no diluted returns per share figures are relevant. The basic and diluted earnings per share are therefore identical.

1. Net Asset Value per Share

The calculation of NAV per Ordinary share as at 31 December 2021 is based on 8,115,376 Ordinary shares in issue at that date (31 December 2020: 8,115,376).

The calculation of NAV per B share as at 31 December 2021 is based on 14,588,659 B shares in issue at that date (31 December 2020: 9,062,948).

1. Fixed Asset Investments

Ordinary Shares

	Level 1:AIM-quoted investments	Level 3:Unquoted investments	Total investments
	£’000	£’000	£’000
Valuation and net book amount:
Book cost as at 1 January 2021	726	2,715	3,441
Cumulative revaluation	894	(2,194)	(1,300)
Valuation at 1 January 2021	1,620	521	2,141
Movement in the year:
Purchases at cost	85	-	85
Disposals – cost	(60)	-	(60)
Disposals – revaluation	(75)	-	(75)
Reclassification in year	205	(205)	-
Revaluation in year	1,199	(78)	1,121
Valuation at 31 December 2021	2,974	238	3,212
Book cost at 31 December 2021	892	2,573	3,465
Revaluation to 31 December 2021	2,082	(2,335)	(253)
Valuation at 31 December 2021	2,974	238	3,212

B Shares

	Level 1:AIM-quoted investments	Level 3:Unquoted investments	Total investments
	£’000	£’000	£’000
Valuation and net book amount:
Book cost as at 1 January 2021	1,010	2,784	3,794
Cumulative revaluation	325	(137)	188
Valuation at 1 January 2021	1,335	2,647	3,982
Movement in the year:
Purchases at cost	3,778	750	4,528
Disposals – cost	(746)	(150)	(896)
Disposals – revaluation	(149)	-	(149)
Revaluation in year	308	180	488
Valuation at 31 December 2021	4,526	3,427	7,953
Book cost at 31 December 2021	4,042	3,384	7,426
Revaluation to 31 December 2021	484	43	527
Valuation at 31 December 2021	4,526	3,427	7,953

Further details of the fixed asset investments held by the Company are shown within the Investment Manager’s Report on pages 14 to 33.

Full details of the methods used by the Company are set out in Note 1 of these financial statements. Where investments are held in quoted stocks, fair value is set at the market bid price.

All investments are initially measured at their transaction price. Subsequently, at each reporting date, the investments are valued at fair value through profit or loss, and all capital gains or losses on investments are so measured. Unquoted fixed asset investments are valued at fair value in accordance with the IPEV guidelines.                                                                                                                                                              The changes in fair value of such investments recognised in these Financial Statements are treated as unrealised holding gains or losses.

Level 3 valuations include assumptions based on non-observable market data, such as discounts applied either to reflect changes in fair value of financial assets held at the price of recent investment, or to adjust revenue or earnings multiples. Of the Company’s Level 3 investments, 49% are held on a revenue multiple basis (2020: 0% were held on that basis) and therefore have significant judgement applied to the valuation inputs. Further, the exit equity waterfall structure as detailed in each investee company’s articles of association is also included as a valuation input. Throughout this exercise, and in determining the value of the Company’s equity investments where trading multiples are considered, multiples used are reviewed and compared to industry peers, based on size, stage of development, revenue generation and growth rate, as well as their wider strategy and market position. These multiples are calculated in the traditional manner, by dividing the enterprise value of the comparable group by its revenue, EBITDA or earnings depending on what is the norm in a particular sector driven by how acquisitions in that sector are typically valued. The trading multiple is then adjusted for considerations such as illiquidity, marketability and other differences, advantages and disadvantages between the portfolio company and the comparable public companies based on company specific facts and circumstances.

When considering the valuations and valuation methodologies, we determined that the fair value for the B share pool’s investments in Qudini, Vizibl, Silkfred and Bright Network Ltd. was most appropriately derived via a revenue multiple based approach. An earnings multiple based approach was not considered appropriate for any B share pool investments at this point given their stage of development.

The valuation for Fabacus is based on the price of funds last raised and the valuation for Solascure is based on the price of the B share pool’s last investment and are reviewed for change in fair value. This is consistent with the approach adopted for the valuation of the Ordinary share pool’s unquoted investments.

When using this methodology however, a detailed assessment of the respective value of each portfolio company is also performed in order to gain the necessary comfort as to whether a fair value reduction or uplift is in fact required. This process involves a review of the progress made by each investee company, recent developments in the M&A market and comparisons to listed competitors across all relevant key performance indicators.

FRS 102 requires the Directors to consider the impact of changing one or more of the assumptions used as part of the valuation process to reasonable possible alternative assumptions. Each of the relevant unquoted portfolio companies has been reviewed in order to identify the sensitivity of the valuation methodology to using alternative assumptions. Where discounts have been applied (for example to revenue levels) alternatives have been considered which still fall within the IPEV Guidelines. For each relevant unquoted investment, two scenarios have been modelled: more prudent assumptions (downside case) and more optimistic assumptions (upside case). Using the upside alternative, the value of the unquoted investments could result in an increase in valuation of the B share pool investments by £426k. Applying the downside alternative, the value of the unquoted investments could result in a decrease in valuation of B share pool investments by £39k. The impact of the downside sensitivity is more limited by the preferential positions in the equity distribution waterfalls of the B share pool investee companies mentioned above.

1. Debtors

	31 December 2021	31 December 2020
	£’000	£’000
Prepayments	9	7

1. Creditors

	31 December 2021	31 December 2020
	£’000	£’000
Amounts falling due within one year
Trade creditors	4	1
PAYE/NIC	6	7
Awaiting B share allotment	-	154
Other creditors	23	23
Accruals	132	37
Total amounts falling due within one year	165	223
Amounts falling due after one year
Accruals	351	193
Total amounts falling due after one year	351	193

The amount falling due after more than one year relates to the potential liability for a performance fee on the Ordinary share portfolio. More details are in Note 6. The awaiting B share issue included in the combined and B share cash flow statements shows the movement in cash awaiting B share issue in the year since the prior year end. Cash awaiting B share issue is now held by Neville, our registrar, until the Company’s next allotment date and is therefore no longer included in the Company's creditors.

1. Share Capital

	31 December 2021	31 December 2020
	£’000	£’000
Allotted and fully paid up:
8,115,376 Ordinary shares of 1p (2020: 8,115,376 shares of 1p) 14,588,659 B shares of 1p (2020 : 9,062,948 shares of 1p)	81146	8191
	227	172

The capital of the Company is managed in accordance with its investment policy with a view to the achievement of its investment objective as set on page 7.

During the year, the Company did not issue, nor buy back, any Ordinary shares.

The Company issued a total of 5,525,711 B shares at prices between 99.4p to 110.7p per B share during the year. These were issued pursuant to the offer for subscription for B shares launched on 13 October 2020 and a further offer for subscription for B shares launched on 29 October 2021 to raise, in aggregate, up to £10 million with an over-allotment facility of up to a further £10 million (before issue costs). The Company has not bought back any B shares.

The total proceeds received for the shares issued in the period was £5,624k for the B share pool.

Share RightsAs regards Income: shareholders shall be entitled to receive such dividends as the Directors resolve to pay out in accordance with the Articles. Under the Articles of the Company, all the assets of the Company and all the liabilities of the Company will be allocated either to the Ordinary share pool or the B share pool. The Ordinary shares will be entitled to the economic benefit of the assets allocated to the Ordinary share pool and the B shares will be entitled to the economic benefit of assets allocated to the B share pool. Therefore, although the rules in the CA 2006 and elsewhere in relation to the payment of distributions will be applicable to the Company on a company-wide basis, the income arising on the portfolios will belong to one or the other of the share classes depending on which portfolio generated the income.

As regards Capital: similarly, the capital assets of the Company will be allocated to either the Ordinary share pool or the B share pool. On a return of capital on a winding-up or on a return of capital (other than on a purchase by the Company of its shares) the surplus capital shall be divided amongst the holders of the relevant share class pro rata according to the number of shares of the relevant class held and the aggregate entitlements of that share class. The Ordinary shares will not be entitled to any capital assets held in the B share pool and the B shares will not be entitled to any capital assets held in the Ordinary share pool. In relation to the purchase by the Company of its shares, the purchase of Ordinary shares may only be financed by assets in the Ordinary share pool and the purchase of the B shares may only be financed by assets in the B share pool.

As regards voting and general meetings: subject to disenfranchisement in the event of noncompliance with a statutory notice requiring disclosure as to beneficial ownership, each shareholder present in person or by proxy shall on a poll have one vote for each share of which he/she is the holder. The Ordinary shareholders may not be entitled to vote on certain matters which concern the B share class only and vice versa.

As regards Redemption: none of the B shares or the Ordinary shares are redeemable. The Articles provide that reserves (whether created upon the cancellation of the share premium account arising from the issue of Ordinary shares or B shares or otherwise) may also be used for the benefit of the other share class. While this will not transfer any net asset value between the different share classes, it will permit those reserves to be treated as distributable profits on a Company-wide basis such that on an accounting basis dividends and share buybacks in respect of both share classes may be facilitated by the availability of those reserves.

1. Movement in Shareholders’ Funds

	Year ended 31 December 2021	Year ended 31 December 2020
	£’000	£’000
Shareholders’ funds at start of year	10,770	8,384
Return on ordinary activities after tax	2,096	1,297
Increase due to issue of B shares	5,624	2,390
Dividend paid	(727)	(1,301)
Shareholders’ funds at end of year	17,763	10,770

The analysis of changes in equity by the various reserves are shown in the Statement of Changes in Equity on page 74.

When the Company revalues its investments during the period, any gains or losses arising are credited/charged to the Income Statement. Changes in fair value of investments held are then transferred to the capital reserve - holding gains/(losses). When an investment is sold any balance held on the capital reserve - holding gains/(losses) reserve is transferred to the capital reserve – gains/(losses) on disposal as a movement in reserves.

The purpose of the special distributable reserve was to create a reserve which will be capable of being used by the Company to pay dividends and for the purpose of making repurchases of its own shares in the market with a view to narrowing the discount at which the Company’s shares trade to net asset value, providing shareholder authority has been granted.

Distributable reserves are represented by the special distributable reserve, the capital reserve gains/(losses) on disposal and the revenue reserve reduced by negative holding reserves (if any) which total £6,525,000 as at 31 December 2021 (2020: £5,429,000). Although the distributable reserves total £6,525,000 as at 31 December 2021, only £2,993,000 is actually able to be distributed as the reserves contain items which weren’t distributable without breaching VCT rules. As at 1 January 2022, the amount of reserves that were distributable was £6,420,000.

An interim capital dividend of 4 pence per Ordinary share for the year to 31 December 2021 was paid on 25 June 2021.

An interim dividend of 1.5 pence per B share for the year to 31 December 2021 was paid on 14 May 2021. A second interim dividend of 1.5 pence per B share for the year to 31 December 2021 was paid on 24 December 2021.

1. Financial Instruments

The Company's financial instruments comprise equity investments, cash balances and liquid resources including creditors.

Classification of financial instrumentsThe Company held the following categories of financial instruments, all of which are included in the balance sheet at fair value, at 31 December 2021 and 31 December 2020:

	31 December 2021	31 December 2020
	£’000	£’000
Financial assets at fair value through profit or loss
Fixed asset investments	11,165	6,123
Total	11,165	6,123
Financial assets measured at amortised cost
Cash and cash equivalents	7,105	5,056
Total	7,105	5,056
Financial liabilities measured at amortised cost
CreditorsAccrualsPerformance fee	33132351	3137193
Total	516	261

Fixed asset investments (see Note 10) are valued at fair value. Unquoted investments are carried at fair value as determined by the Directors in accordance with the IPEV guidelines. The fair value of all other financial assets and liabilities is represented by their carrying value in the balance sheet. The Directors believe that the fair value of the assets held at the year-end is equal to their book value.

The Company’s creditors are initially recognised at fair value, which is usually the transaction price, and then thereafter at amortised cost.

The Company’s Ordinary share pool provided an indemnity to the Royal Bank of Scotland (“RBS”) in 2013 of £250,000 in relation to the registration of its shareholding in Omega Diagnostics Group Plc (“Omega”). The investment in Omega was made in 2007 and was fully exited in September 2020. The Board has not recognised any liability in relation to this historic indemnity as at 31 December 2021 and is liaising with RBS regarding the formal release of the indemnity.

1. Financial Risk Management

In carrying on its investment activities, the Company is exposed to various types of risk associated with the financial instruments and markets in which it invests. The most significant types of financial risk facing the Company are market risk, credit risk and liquidity risk. The Company's approach to managing these risks is set out below together with a description of the nature and amount of the financial instruments held at the balance sheet date.

Market riskThe Company’s strategy for managing investment risk is determined with regard to the Company’s investment objective, as outlined on page 7. The management of market risk is part of the investment management process. The Company's portfolio is managed with regard to the possible effects of adverse price movements and with the objective of maximising overall returns to shareholders in the medium term. Investments in unquoted companies, by their nature, usually involve a higher degree of risk than investments in companies quoted on a recognised stock exchange, though the risk can be mitigated to a certain extent by diversifying the portfolio across business sectors and asset classes. The overall disposition of the Company's assets is regularly monitored by the Board.

Details of the Company’s investment portfolio at the balance sheet date are set out on pages 14 to 33.

20.6% (2020: 29.4%) by value of the Company’s net assets comprise investments in unquoted companies held at fair value. The valuation methods used by the Company include the application of a price/earnings ratio derived from listed companies with similar characteristics, and consequently the value of the unquoted element of the portfolio can be indirectly affected by price movements on the London Stock Exchange. A 10% overall increase in the valuation of the unquoted investments at 31 December 2021 would have increased net assets and the total return for the year by £367,000 (2020: £317,000) disregarding the impact of the performance fee; an equivalent change in the opposite direction would have reduced net assets and the total return for the year by the same amount.

42.2% (2020: 27.4%) by value of the Company’s net assets comprises equity securities quoted on AIM. A 10% increase in the bid price of these securities as at 31 December 2021 would have increased net assets and the total return for the year by £750,000 (2020: £296,000) disregarding the impact of the performance fee; a corresponding fall would have reduced net assets and the total return for the year by the same amount.

Credit riskThere were no significant concentrations of credit risk to counterparties at 31 December 2021 or 31 December 2020.

Credit risk is the risk that a counterparty to a financial instrument will fail to discharge an obligation or commitment that it has entered into with the Company. The Board carries out a regular review of counterparty risk. The carrying values of financial assets represent the maximum credit risk exposure at the balance sheet date.

Liquidity riskThe Company’s financial assets include investments in unquoted equity securities which are not traded on a recognised stock exchange and which generally are illiquid. They also include investments in AIM-quoted companies, which, by their nature, involve a higher degree of risk than investments on the main market. As a result, the Company may not be able to realise some of its investments in these instruments quickly at an amount close to their fair value in order to meet its liquidity requirements, or to respond to specific events such as deterioration in the creditworthiness of any particular issuer.

The Company’s liquidity risk is managed and monitored on a continuing basis by the Board in accordance with policies and procedures laid down by the Board.

1. Events After the Balance Sheet Date

In February 2022, the Company made an additional investment of £500k into the IPO of Clean Power Hydrogen Plc (“CPH2”) from the B share pool, which was fully realised shortly thereafter generating a profit of £172k, with an average weighted return of 1.4x on original cost.

In March 2022, the Company made a further investment of £280k into the AIM quoted company Verici Dx Plc from the B share pool.

Further, the Company sold 125,000 additional shares in SkinBio following the year end, reducing the remaining holding to 1,857,107 shares, realising £65k, generating a profit of £45k, with an average weighted return of 3.2x on original investment cost.

The Company declared an interim B share dividend of 1.5p per B share on 8 March 2022 to be paid on 20 May 2022 to shareholders on the B share register on 6 May 2022, with an ex-dividend date of 5 May 2022.

The Ordinary share pool’s AIM quoted investments made up 94% of the Ordinary share pool’s NAV as at 31 December 2021. Since the year end, the Ordinary share pool’s AIM quoted investments have decreased in value over a sustained period. The share price of Scancell decreased significantly from 19.5p at 31 December 2021 and was 11.5p at 23 March 2022 and likewise Arecor’s share price decreased from 370p at 31 December 2021 to 350p at 23 March 2022. As a result, the Ordinary share pool’s updated unaudited NAV is 29.2p per Ordinary share at 23 March 2022.

The Directors are not aware of any other post balance sheet events which need to be brought to the attention of shareholders.

1. Contingencies, Guarantees and Financial Commitments

There were no contingencies, guarantees or financial commitments as at 31 December 2021 (2020: £nil).

1. Related Party Transactions

The Board acted as the investment manager of the Company until Seneca was appointed on 23 August 2018. Certain Directors are entitled to participate in a performance bonus as detailed in Note 6. During the year, Seneca has earnt £246,000 in management fees (2% of the weighted average net assets of the B share portfolio) (2020: £127,000). However, only £211,000 is recoverable by Seneca as a result of the cost cap, as detailed in Note 3 and this was paid to Seneca during the year (2020: £41,000).

Seneca as Investment Manager accrued £74,193 (2020: £76,191) transaction fees and directors’ fees from investee companies in relation to the arrangement and monitoring of investments. As a related party, we believe that this transaction is disclosable, and the Board ensures it is managed from a conflicts of interest point of view. Seneca may also become entitled to a performance fee. See Note 3 to the financial statements for more information on these fees.

As detailed in the offer for subscription document dated 13 October 2020 and the subsequent offer for subscription document dated 29 October 2021, Seneca (as promoters of the Offer) is entitled to charge the Company up to 5.5% of investors’ subscriptions. A total of £35,278 has been paid to Seneca for the year ended 31 December 2021 (2020: £6,595). An accrual of £3,750 is also included in the period for Richard Manley’s Director’s Fee for Q4 2021 as detailed in the Directors’ Remuneration Report and Policy on pages 54 to 57 (2020: £nil).