1、Amati AIM VCT plcAnnual Report&Financial StatementsFor the year ended 31 January 2024Company Registration No.04138683Finely crafted investmentsAmati AIM VCT plcOUR STRATEGYThe investment objective of the Company is to generate tax free capital gains and income on investors funds through investments
2、primarily in AIM-traded companies.DIVIDEND POLICYThe Board aims to pay annual dividends of around 5%of the Companys Net Asset Value at its immediately preceding financial year end,subject to distributable reserves and cash resources,and with the authority to increase or decrease this level at the Di
3、rectors discretion.Company Registration No.04138683This document is important.Shareholders who are in any doubt as to what action to take should consult an appropriate independent adviser.If you have sold or transferred all your shares in the Company,this document should be passed to the person thro
4、ugh whom the sale or transfer was effected for transmission to the purchaser or transferee.1Amati AIM VCT plcAnnual Report&Financial Statements 2024HighlightsStrategic ReportReports from the DirectorsFinancial StatementsInformation for ShareholdersFor the year ended 31 January 2024NAV Total return f
5、or the year-22.6%(2023:-22.2%)13.3minvested in qualifying holdings during the year(2023:12.4m)2.0%Ongoing charges*(2023:1.9%)6.6%Discount to NAV(2023:7.0%)5.3%Dividend yield*(2023:5.3%)Year end Net Asset Value per share94.7p(2023:132.8p)HighlightsHighlights1Strategic ReportChairmans Statement4Fund M
6、anagers Review7Fund Manager Biographies13Investment Portfolio15Investment Policy,Investment Objective and Investment Strategy19Fund Management and Key Contracts21Principal and Emerging Risks22Section 172 Statement26Other Matters29Reports from the DirectorsBoard of Directors31Directors Report32Statem
7、ent of Corporate Governance36Report of the Audit Committee40Directors Remuneration Report43Statement of Directors Responsibilities47Independent Auditors Report to the Members of Amati AIMVCT plc48Financial StatementsIncome Statement56Statement of Changes in Equity57Balance Sheet59Statement of Cash F
8、lows60Notes to the Financial Statements61Information for ShareholdersShareholder Information77Alternative Performance Measures78Notice of Annual General Meeting80Corporate InformationIBCKey data31/01/2431/01/23Net Asset Value(“NAV”)143.1m201.3mShares in issue151,069,824151,548,993NAV per share94.7p1
9、32.8pShare price88.5p123.5pMarket capitalisation133.7m187.2mShare price discount to NAV6.6%7.0%NAV Total Return for the year (assuming re-invested dividends)-22.6%-22.2%Deutsche Numis Alternative Markets Total Return Index*-12.1%-20.7%Ongoing charges*2.0%1.9%Dividends paid and declared in respect of
10、 the year5.0p7.0p*Deutsche Numis Alternative Markets Index is included as a comparator benchmark for performance as this index includes all companies listed on qualifying UK alternative markets.*Ongoing charges calculated in accordance with the Association of Investment Companies(“AICs”)guidance.*Di
11、vidend yield based on year end NAV.See Alternative Performance Measures on pages 78 and 79.IBC:Inside Back Cover2Amati AIM VCT plcAnnual Report&Financial Statements 2024HighlightsTable of investor returnsto 31 January 2024FromDateNAV Total Return with dividends re-investedDeutsche Numis Alternative
12、Markets Total Return IndexNAV following re-launch of the VCT under management of Amati Global Investors(“Amati”)9 November 2011*85.5%15.2%NAV following appointment of Amati as Manager of the VCT,which was known as ViCTory VCT at the time25 March 201094.7%18.4%*Date of the share capital reconstructio
13、n when the NAV was rebased to approximately 100p per share.A table of historic returns is included on page 77.Dividends paid and declaredDividend historySince the re-launch of the VCT under the management of Amati Global Investors*Year ended 31 JanuaryTotal dividends per share*pCumulative dividends
14、per share p20114.744.7420125.5010.2420136.0016.2420146.7522.9920156.2529.2420166.2535.4920177.0042.4920188.5050.9920197.5058.4920207.7566.24202110.5076.7420229.0085.7420237.0092.7420245.0097.74*On 25 March 2010 Amati Global Investors was appointed as Manager of ViCTory VCT.On 8 November 2011 Invesco
15、 Perpetual AIM VCT merged with ViCTory VCT and the name was changed to Amati VCT 2.On 4 May 2018 the Company merged with Amati VCT and the name was changed to Amati AIM VCT.*Total dividends per share are the declared dividends of the financial year.2024 total dividends per share 5.0p28.6%5.3%of NAVC
16、umulative dividends per share97.74p3Amati AIM VCT plcAnnual Report&Financial Statements 2024HighlightsStrategic ReportReports from the DirectorsFinancial StatementsInformation for Shareholders25/03/1025/03/1125/03/1225/03/1325/03/1425/03/1525/03/1625/03/1725/03/1825/03/1925/03/2025/03/2131/03/2331/0
17、1/2425/03/2244039034029024019014090Amati AIM VCT NAVTotal Return(rebased to 100)Deutsche Numis AlternativeMarkets Total ReturnIndex(rebased to 100)Amati AIM VCTSince Amati VCTMerger intoSince InvescoPerpetual Mergerinto Amati VCT 231/1/0131/1/0231/1/0331/1/0431/1/0531/1/0631/1/0731/1/0831/1/0931/1/1
18、031/1/1131/1/1231/1/1331/1/1431/1/1531/1/1631/1/1731/1/1831/1/1931/1/2031/1/2131/1/2231/1/2331/1/2421019017015013011090705030Amati AIM VCT NAV Total Return(rebased to 100)Deutsche Numis Alternative Markets Total Return Index(rebased to 100)Fund PerformanceHistoric performanceAmati AIM VCT NAV Total
19、Return and Deutsche Numis Alternative Markets Total Return Index from change of Manager on 19 March 2010(first Net Asset Value calculated on 25 March 2010)to 31 January 2024Amati AIM VCT NAV Total Return and Deutsche Numis Alternative Markets Total Return Index from inception of fund to 31 January 2
20、0244Amati AIM VCT plcAnnual Report&Financial Statements 2024Strategic ReportChairmans StatementFiona WollocombeChairmanThis report has been prepared by the Directors in accordance with the requirements of Section 414A of the Companies Act 2006.Overview and Investment PerformanceThis felt like a year
21、 of ongoing risk-aversion,with 2023 undoubtedly one of the most hostile markets for junior AIM companies since the financial crisis of 2008.This was most notable for companies which were relying on raising additional funds and in some cases were unable to access further VCT monies due to an evolving
22、 debate around the application of the VCT Regulations.In addition,some of our long-standing investments in companies which have matured into medium-sized businesses were impacted by cyclical downturns and negative sentiment.The NAV total return for the period was-22.6%,which compares to a return of-
23、12.1%for the Deutsche Numis Alternative Markets Index.With the market having turned negative in late 2021,this has resulted in over two years of decline in the value of the portfolio and inevitably raises some questions about the health of the AIM market overall.The more mature businesses in the por
24、tfolio,which have taken many years to reach this point,should provide good exposure to any recovery in the market.The fortunes of early-stage companies are more fragile,and it is likely to take longer for this part of AIM to recover.This is discussed in more detail in the Managers Review which follo
25、ws.The number of VCT qualifying deals on AIM remained relatively low this year and only a handful were of sufficient quality to be of interest.A total of 13.3m was invested in qualifying holdings,slightly more than in the prior year,but still well down on the 2021 level.At the same time some profits
26、 were taken in a few of the longer standing holdings,and some were sold outright,with total sales amounting to 12.9m that resulted in net losses realised of 8.9m.Further details are again provided in the Managers Review.As a result,cash and current asset investments levels remained high at the end o
27、f the period at 45.6m.Cash and current asset investments are held mainly in a combination of interest bearing overnight bank deposits and money market funds.DividendsThe Board aims to pay annual dividends of around 5%of the Companys Net Asset Value at its immediately preceding financial year end,sub
28、ject to the Companys distributable reserves and cash resources,and with the authority to increase or decrease this level at the Directors discretion.At the end of November,the Board took the decision to pay a second interim dividend.This meant that the payment was made around six months earlier than
29、 would have been the case had this been a final dividend.This reflected the scarcity of qualifying investment opportunities on AIM of an acceptable quality and a lack of visibility over the timing of further qualifying investments.When combined with significant realisations of qualifying holdings th
30、e Board felt it prudent to accelerate the timing of the dividend payment so as to have a bigger margin of comfort against the VCT qualifying tests.As at 31 January 2024 the net asset value was 94.7p.The Board paid an interim dividend of 2.5p per share in November and the second interim dividend of 2
31、.5p per share in January,making a total for the year of 5.0p per share,which is 5.3%of year end NAV.The Board would like to remind shareholders that the company has moved to paying all cash dividends by bank transfer,rather than by cheque and details are provided in Shareholder Information on page 7
32、7.Please check that you have received your dividends and contact the registrar if you have not.Unpaid dividends are kept by the registrar for a period of 10 years after the payment date and we make every effort to ensure that dividends are received correctly by shareholders.5Amati AIM VCT plcAnnual
33、Report&Financial Statements 2024HighlightsStrategic ReportReports from the DirectorsFinancial StatementsInformation for ShareholdersWith cash levels still remaining high and the rate of new investments still running at relatively low levels,the Board is not planning to raise further funds in the nea
34、r term.Strategic ReviewIn March,the Board announced that it was considering the Companys strategic options in the light of the ongoing challenges in the AIM market and the resultant impact on the companys performance.As part of this review,the Board had been working with the Manager on a proposal th
35、at would have addressed the Boards concerns and enabled the Company to widen its investment strategy to facilitate investments in a broader range of securities.As this opportunity did not conclude,the Board and the Manager are continuing to review the strategic direction of the VCT and evaluating ot
36、her alternatives available to the Company.VCT LegislationThe VCT legislation contains a“sunset clause”which would have brought income tax relief to an end on 5April 2025.Following confirmation by the Chancellor in his Autumn statement that the scheme will continue,the Finance Act has now been passed
37、 which allows VCT income tax relief to be available for subscriptions for VCT shares until 5 April 2035.This however can only come into force when the EU gives approval.The Board understands that HM Treasury officials expect approval to be given,but the timescale for this is not yet known.Annual Gen
38、eral Meeting(“AGM”)The AGM this year will be held at Barber-Surgeons Hall,Monkwell Square,Wood Street,London EC2Y 5BL starting at 2pm on Thursday 13 June 2024.This will be followed by presentations from the Manager and investee companies.Details are being sent to you with this report.The Notice of A
39、GM is set out on pages 80 to 85 of this report.The Board recognises that the Companys AGM represents an important forum for shareholders to put questions to the Directors,to express their views on governance and to become fully informed about matters relating to the AGM resolutions.We understand tha
40、t attending in person may not be possible for all shareholders who wish to attend.Therefore,the Company intends to also make available a live stream facility to allow shareholders to watch and listen to the AGM and the Investor Event which follows.If shareholders wish to use this facility,please reg
41、ister your interest by emailing and shortly ahead of the event the Companys Manager will post a link and instructions on how to join the event on its homepage at .Shareholders watching the AGM will not be counted towards the quorum of the meeting and will not be able to participate in the formal bus
42、iness of the meeting,including asking questions and voting on the day.The Board encourages shareholders to engage with the Board and the Companys Manager.In addition to asking questions at the AGM,shareholders can email any questions they may have on the business of the AGM to by 7 June 2024.The Com
43、panys Manager will publish questions together with answers on the page dedicated to the AGM on the Managers website prior to the AGM being held.The Companys Manager will reply to any individual shareholder questions submitted by the deadline of 7 June 2024,before the AGM.OutlookThe AIM market remain
44、s in a fragile state,especially for companies capitalised at less than 100m and pre-profit early-stage companies.The bright spots we had hoped for last year were few and far between.We have noted a growing trend towards companies opting for a private sale or fundraising rather than an AIM listing.Sh
45、areholders frequently ask why the Manager does not buy more shares in existing portfolio holdings whose share prices have been pounded.Unfortunately,the changes to the VCT legislation in 2016-17 specifically prevent VCTs from making non-qualifying investments in AIM or unquoted companies.This means
46、the VCT can only acquire more shares in portfolio companies if they raise further funds and are still qualifying under the rules,which in many cases they are not.The problems for investments made under post 2017 VCT rule changes are discussed in further detail in the Managers review.Historically the
47、re is evidence that companies that come through this kind of a market crisis tend to emerge a good deal stronger.In a falling interest rate environment,it would not take much for market dynamics to become a good deal more positive and this should benefit our existing portfolio.6Amati AIM VCT plcAnnu
48、al Report&Financial Statements 2024There are still many headwinds for the economy to navigate which may,directly or indirectly,affect the AIM market in an election year.We can only hope that the building blocks will be put in place to maximise the potential for young and growing UK companies to thri
49、ve once again in public markets.Contact usThe Board is always keen to hear from shareholders.You can contact me at:AmatiAIMVCTC.You can also find regularly updated information on the Company,including a factsheet and performance data on the Companys website:Fiona WollocombeChairman11 April 2024For a
50、ny matters relating to your shareholding in the Company,dividend payments,or the Dividend Re-investment Scheme,please contact The City Partnership on 01484 240 910,or by email at For any other matters please contact Amati Global Investors(“Amati”)on 0131 503 9115 or by email at .Amati maintains an i
51、nformative website for the Company on which monthly investment updates,performance information,and past company reports can be found.Chairmans Statement(continued)7Amati AIM VCT plcAnnual Report&Financial Statements 2024HighlightsStrategic ReportReports from the DirectorsFinancial StatementsInformat
52、ion for ShareholdersFund Managers ReviewMarket ReviewIn what was another poor year for AIM companies,especially those at an early stage of growth,global markets recovered their poise during the period under review,in large part thanks to a boom in US technology companies poised to lead the way in th
53、e deployment of artificial intelligence.Japanese and European markets also saw meaningful recoveries.By contrast,the UK equity market as a whole remained in the doldrums with the Deutsche Numis All Share Total Return Index returning only 1.6%over the period and the Deutsche Numis Alternative Markets
54、 Total Return Index falling by 12.1%,reflecting ongoing risk-aversion and weak liquidity at the lower end of the UK market.2023 was probably the toughest market for junior AIM companies since 2008.The gains in the large global technology companies were achieved despite a deteriorating and fragile ge
55、o-political environment.Russias invasion of Ukraine appears to have reached something of a stalemate and the outcome remains dependent on ongoing Western support for Ukraine being maintained.A new and significant conflict emerged in October,as war erupted in Palestine in response to Hamas attacks on
56、 Israel.This brought considerable instability into the region,which shows no signs of abating.Investors also remain concerned about the ongoing potential for China to become more bellicose in a year where elections are taking place in a number of major economies.Despite these concerning developments
57、,commodity prices remained subdued with oil prices down during the period and gas prices falling materially from their post-Ukraine highs of the previousyear.The dominant economic theme during the year was the global fight against inflation,with the Fed,the European Central Bank and the Bank of Engl
58、and simultaneously increasing interest rates rapidly from historically low levels.This in turn led to rises in bond yields in most G7 markets as central banks sought to normalise policy.Despite this more uncertain environment there was evidence that the global financial system remained robust,with t
59、he collapse of SVB Bank,First Republic and Signature in the US and the unravelling of Credit Suisse in Europe all seeing bailouts by larger,better capitalised institutions.As the year progressed,we saw evidence that inflation was being brought under control with headline numbers falling sharply in t
60、he US,UK and Europe,albeit from elevated levels.This was consistent with a deterioration in global growth prospects as both Europe and the UK began flirting with recession and Chinese growth prospects faded meaningfully.In the final months of the period under review both large and midcap equity and
61、bond markets enjoyed strong recoveries from depressed levels,taking heart from the expectation that an end to the period of monetary tightening is now in sight.We have seen rate expectations fall in the US,EU and UK and there is now a firm belief that 2024 will be a year of monetary easing.However,t
62、his path will not necessarily be a straight one and inflation data in early 2024 has been more elevated than markets would have hoped,leading to bond yields rising again.The direction of travel may be clear but the speed less so.Returning to UK markets we have seen ongoing material outflows from ope
63、n-ended UK equity funds,continuing the weak trend of recent years,and there are considerable challenges in re-establishing the UK market as an attractive place for companies to list and raise capital.However,we do detect a greater commitment from the Chancellor,the FCA and politicians across the pol
64、itical spectrum to address these increasingly urgent problems.This is particularly pressing with regards to AIM,where a lack of Initial Public Offerings(IPOs)and concerns about changes to taxation regimes have contributed to an ongoing shrinkage of the market.Performance ReviewThe VCTs NAV Total Ret
65、urn for the period was-22.6%.This was substantially behind the benchmark,the Deutsche Numis Alternative Markets Total Return Index,which fell-12.1%.Data compiled by Deutsche Numis,which analyses the performance of UK smaller companies from 1955 onwards,shows that 2023 was a particularly outlying yea
66、r.For nearly seventy years,the smallest market capitalisation companies in the UK market(defined as the bottom 70%)have cumulatively outperformed their larger peers the so-called small company“premium”.However,in 2023,“smaller”significantly underperformed“larger”as a factor in the UK market.This was
67、 caused by the smallest AIM stocks generally being by far the worst performers in the period covered by this review,as investors shied away from taking the liquidity risk inherent at this end of the market.Since this segment of AIM is the target universe for VCT qualifying companies,incorporating ve
68、ry early-stage businesses,this represented a particularly difficult environment for the portfolio.8Amati AIM VCT plcAnnual Report&Financial Statements 2024A significant portion of the portfolio saw share price falls during the year.The largest falls related to companies requiring further financing i
69、n a market which was increasingly reluctant to finance early-stage companies.For these companies being quoted on AIM in this environment tended to prove detrimental,as tightened disclosure regulations can force companies to make announcements about funding requirements before they are able to optimi
70、se a plan to address them.The biggest negative contributor to performance was Polarean Imaging,a lung medical imaging company,which fell 82%in the period.The company had a poor start to the year announcing its cash reserves would last until May 2024,and that it would move to a dual strategy of self-
71、commercialisation while seeking a partner.It also indicated that it would require further funding,at a time when both private and public equity markets had turned their back on earlier stage healthcare companies.On the positive side,a new CEO was recruited,more suited to taking the company through i
72、ts next stage of development,and the company established a US reimbursement code while it continued to build a pipeline of sales opportunities and trimmed costs to extend the cash runway.Education of hospitals about the technology and the benefits it can bring,is a multi-faceted task involving clini
73、cians as well as hospital administrators.Articulating the value and revenue it can generate and converting this into purchase orders is a lengthy process.Another significant underperformer was the outsourced services specialist to the global video games industry,Keywords Studios,which fell 42%in the
74、 period.This was despite the company reporting full year revenue growth of 13%,with around 6%of this organic augmented by five completed acquisitions,and an operating margin of over 15%.Whilst this performance was behind previous levels,the company had significant trading headwinds to mitigate,inclu
75、ding the US entertainment strikes and a slowdown across the global industry.Nevertheless,Keywords still managed to outpace organic market growth,thus taking market share.Sentiment also played a part in the share weakness,with expectations that Artificial Intelligence(AI)machine-created technology wi
76、ll present games publishers with in-house alternatives to outsourced services.However,such spend on AI will likely be beyond the reach of some customers,and Keywords was already investing in this area to improve its competitiveness,service quality and product offering.e-learning specialist,Learning
77、Technologies,also impacted the portfolios performance,falling 42%.In its full year results,the company reported an organic revenue decline of 2%.This reflected a slowdown in transactional and project-based work from its key financial services and technology clients,plus difficulties with the integra
78、tion of a recent acquisition.Cost-cutting,however,protected operating margins at more than 17%,and also significantly reduced debt.Learning Technologies share price was also impacted by AI concerns about machine-created education,but again,the company is examining its own investment into this and th
79、e potential productivity gains which could begenerated.One of the few successful flotations on AIM within the last couple of years has been high-end semiconductor chip designer and manufacturer,Ensilica,which specialises in Application Specific Integrated Circuits(ASICs).Since its listing in late 20
80、22,the company has broadened its customer base from the automotive market into industrial,healthcare and satellite communication applications.Revenues grew 34%year-on-year to May 2023,with significantly higher margins and operating profits.Last November it sought to raise up to 5m equity to support
81、the execution of a growing pipeline of new business opportunities.By this stage of its growth,however,the company had ceased to be VCT-qualifying,and so,frustratingly,the Company was unable to support the fund raise.The difficult environment for risk appetite meant that only c1.5m was eventually rai
82、sed at a substantial discount.This impacted the shares,which fell 58%in the period.Velocys,which developed catalytic reactor technology for use in the production of Sustainable Aviation Fuel(SAF)from wood chips or waste sources,and which was developing large scale projects in both the UK and US,stru
83、ggled during the period to refinance its currently loss-making operations.This was despite receiving c30m of government grants in late-2022 and having significant SAF offtake agreements with customers.Negotiations continued for much of the second half of the period under review,and during this time
84、the decision was taken to reduce,and ultimately exit,the position in view of the funding risks involved.The shares fell 95%in the period,and in February 2024 the company was eventually taken private.Video gaming developer and publisher,Frontier Developments,had a challenging year in keeping with the
85、 slowdown in consumer demand across the industry.In November,the company announced a strategic review,to move away from third-party publishing and re-focus on its own,core,creative management simulation games.This has involved a major cost cutting programme,targeting a return to profitability in fin
86、ancial year ending May 2025.The company retains significant cash resources.The shares fell 70%.Other negative contributors included Saietta,the developer of eDrive systems for electric vehicles.Similar to Ensilica,Saietta also no longer qualified for VCT investment.The company raised 7m of highly di
87、lutive funding in November,as part of a larger fund raise intended to complete in March 2024.Unfortunately when the company lost a cash flow boosting contract in February,and one of its customers in India failed to deliver on a promised contract,the March fund raise became too difficult to complete
88、with the result that the company appointed an administrator.This was a sad end to what had seemed a highly promising business.Energy and water efficiency solutions provider,Fund Managers Review(continued)9Amati AIM VCT plcAnnual Report&Financial Statements 2024HighlightsStrategic ReportReports from
89、the DirectorsFinancial StatementsInformation for ShareholdersEneraqua,and IT training business,Northcoders,experienced difficult trading conditions during the period after achieving successful listings in 2021.Both were hit by demand downturns involving key customers.Eneraquas local authority social
90、 housing base has been impacted by budgetary constraints,alongside priority spending on insulation,fire cladding,and damp and mould renovations.Accordingly,funding in these areas has pushed back investment in new utility systems.Northcoders corporate business,where training programmes are developed
91、for specific employers,was hit by a general environment of cutbacks in staff spending.The already partially written down unquoted convertible loan holding in electronics company eleXsys was written down to zero during the period,as long expected investment in the company to commercialise the company
92、s grid management technology failed to materialise.Offsetting these negatives were good performances in the period from some of the longer held investments within the portfolio.Healthcare software specialist,Craneware,which has been a holding for almost 20 years,gained 51%.This followed an improving
93、 market backdrop,whereby US hospitals and pharmacy providers re-focused on future growth and operational efficiency following a prolonged period of spending slowdown and shifted priorities,due to an overhang from the pandemic.First half revenue growth accelerated to 8%,and earnings also grew reversi
94、ng the decline seen in the previous year.Franchised property services operator,Belvoir,which has been a holding since 2012,gained 43%.Whilst franchisee fees from estate agencies declined in 2023,this was more than offset by growth from lettings agencies and also financial services such as mortgage a
95、dvice.Overall,the company achieved growth progress in a difficult trading environment as interest rates climbed,and this reflects the robustness of the franchise business structure.More importantly it was announced in January of this year that Belvoir was the subject of a nil premium merger with ano
96、ther portfolio holding,Property Franchise(held since 2013)whose shares gained 40%.This welcome development creates a company with a combined market capitalisation of almost 200m,which will broaden the investor audience for the shares.There is scope for the larger group to generate meaningful revenue
97、 and cost synergies in due course.Glantus,the accounts payable analytics software provider,which had a difficult time since listing in 2021 as it restructured and missed revenue forecasts,received an industry buyer approach as trading improved.The shares rose nearly four-fold in the period.Property
98、services group,Kinovo,a holding since 2015,announced strong interim results with operating profit growth significantly ahead of revenue growth due to a favourable mix of high margin business.This was principally within electrical services,where new legislation,such as the Building Safety Acts,is dri
99、ving non-discretionary landlord spend following the Grenfell Tower disaster.The shares gained 97%.Other positive contributors were Equals,Creo Medical and Eden Research.Equals,the FX payment services specialist held since 2014,continues to trade strongly as it shifts its focus from consumers to corp
100、orates,generating stronger growth and profit margins.In November,the company announced it was exploring a potential sale with interested parties,discussions with which are ongoing.Creo Medical,an endoscopy medical device company,gained after announcing an oversubscribed fundraise.This cleared a mate
101、rial overhang in the stock and gave it a very comfortable runway to breakeven and beyond.In the period,the company continued to generate positive news flow about the regulatory approval of its advanced energy devices and their use in surgical procedures globally.Most impressively,the company highlig
102、hted the progression of its partnership with Intuitive Surgical,the global leader in robotic assisted surgery,as the companies move towards integrating their technologies.Eden Research,a sustainable biopesticide company,also rose following an oversubscribed fundraise and news of a major partnering f
103、or its products.Corteva,a global agriculture company,partnered with Eden Research on the development and commercialisation of Ecovelex in the UK and EU.Ecovelex is a bird deterrent seed treatment.The product is derived from plant based chemistry which works by creating an unpleasant odour and taste
104、which repels birds.Portfolio ActivityOver the course of the period under review,the Company made five new investments and seven follow-on investments.A total of 9.8m was invested in the five new investments and 4.5m in the seven follow-on investments(of which one,the follow-on investment of 1m in Ve
105、rici DX,settled out of the reporting period).The new investments comprised two IPOs and two secondary placings on AIM,as well as one unquotedinvestment.In the first half of the period,the Company participated in the flotation of Fadel Partners,a developer of cloud-based software for royalties manage
106、ment,digital asset management and brand compliance.Fadels customers are licensors and licensees across a range of markets covering media,entertainment,publishing,consumer brands and technology.The products incorporate sophisticated image and video recognition powered by AI search tools.The business
107、reported revenue of$14.5m for 2023.In the second half of the year the Company participated in the IPO of Tan Delta,a developer and supplier of sensors and systems which uses innovative real time oil analysis technology to allow operators of engineering equipment to cut maintenance costs,improve reli
108、ability,and reduce carbon footprint.Traditionally,oil monitoring is managed in compliance with preset service intervals,which results in lubrication oil being discarded when it can still have 30-50%of 10Amati AIM VCT plcAnnual Report&Financial Statements 2024its useful life left.With limited sales r
109、esource prior to its IPO,Tan Delta has built a customer list with major names such as Shell,Schlumberger and Aggreko,and its technological edge lies in it being able to test many types of installed equipment and oil types.The addressable market is significant and global.A key positive is that the No
110、n-Executive Chairman is already known to us as CEO of another portfolio holding,SRT Marine Systems.In March,an unquoted investment was made in 2 Degrees,alongside Maven Capital Partners.The company provides large corporates and their suppliers with an online Software as a Service platform to measure
111、,manage and reduce carbon within supply chains,thereby helping to achieve the Green House Gas Protocol Scope 3 emissions standard.The platform includes a planning tool and AI-driven recommendations for best practices to reduce carbon.Current markets are in food retail and automotive,with scope to gr
112、ow beyond this.Investments through secondary placings in existing AIM companies involved Itaconix and Cordel.Both were completed in the first half.The former is a US developer of a plant-based polymer used to decarbonise everyday consumer products.The company has been on AIM since 2012,but only achi
113、eved commercial breakthrough in 2020 with a bio-polymer ingredient for dishwasher detergent.Close to 150 consumer products now use Itaconix ingredients,involving major retailers such as Amazon,Walmart,Aldi and Tesco.With opportunities to grow into personal hygiene and beauty products,the company is
114、forecast to breakeven in its current financial year.Cordel floated on AIM in 2018,and a year later acquired its current business activity,an AI analytical software platform to automate inspection and management of rail infrastructure.Using highly accurate Light Detection and Ranging sensors mounted
115、onto train rolling stock,the technology replaces human surveying of vegetation infringements,infrastructure clearances,crossings,drainage and ballast,in order to meet regulatory requirements and prevent accidents.Commercial success to date includes contracts with Network Rail,Angel Trains and Amtrak
116、.The company is forecast to breakeven in the current financial year.Three of the seven follow-on investments took place in the first half of the period and involved antibody developer Fusion Antibodies;fire safety product specialist Zenova;and sustainable biopesticides formulator Eden Research.A sma
117、ll placing participation with Fusion Antibodies was limited to our equity percentage,to avoid dilution.Fusion Antibodies has had to broaden its customer offering to provide an end-to-end therapeutic antibody service,which captures earlier stage customers and generates repeat business.Alongside the r
118、aise there was a management commitment to significant cost cuts being made through to 2024.Zenova was also a modest investment,within an overall placing to get the company to breakeven after a slow start to revenue growth from its range of fire prevention products with mass market potential.Despite
119、difficulties caused by Covid delays,Eden Research(reported on above)is continuing to develop a global portfolio of biopesticide products with international approvals.The company has made excellent strides in reorganising its distributor base to bring in higher quality companies,and further product s
120、ubmissions are ongoing.In the second half of the period,follow-on investments were made in composite aircraft component manufacturer,Velocity Composites;autonomous vehicle developer,Aurrigo;automotive wiring connector specialist,Strip Tinning;and organ transplant diagnostics developer,Verici DX.Velo
121、city Composites is seeing a significant pick-up in its European and US business in line with the recovery in the commercial aerospace market,driven by Middle Eastern airline demand and a global transition to more fuel-efficient aircraft.In December 2022,the company announced a five year$100m contrac
122、t with GKN Aerospace involving a diverse range of high-performance composite structures across military,civil,and business jet programmes.The significant fundraise was used to provide working capital and further investment into the companys US facility.Aurrigo has made progress on a number of fronts
123、 since its IPO in 2022.Luggage tug trials are continuing at Changhi airport in Singapore,a project has been won for a cargo version for UPS,and further work is being done on a passenger shuttle vehicle.Airport development clients now include Changhi,Stuttgart,Schiphol and Cincinnati,with the latter
124、involving carrier IAG.We participated pro rata to our equity percentage in the fundraise.Strip Tinning raised significant working capital,partly in the form of convertible loan in which the Company participated,to fund a pipeline of glazing and EV nominations from large automotive original equipment
125、 manufacturers.Having cut costs in a tough post-Covid environment for the industry,the company has now returned to breakeven.After securing a licensing agreement in November with global major Thermo Fisher Scientific for an early rejection,pre-kidney transplant test,Verici DX raised significant fund
126、ing to take it through to 2025 when it hopes to reach profitability on the back of similar deals.In addition to the exits from Glantus and Velocys noted above,there were a number of other disposals from the portfolio during the period.Rare disease biopharmaceutical company Amryt Pharmaceuticals was
127、sold following the recommended offer in January by Chiesi Farmaceutici S.p.A.This has been a successful investment for the Company.Angle,the liquid biopsy developer,was sold on concerns that its technology could be superseded by alternative circulating tumour DNA diagnostics.Anpario,the animal feeds
128、 additive specialist,was exited as it had been a holding for around fifteen years and had reached a stage of maturity in terms of its prospects.Fund Managers Review(continued)11Amati AIM VCT plcAnnual Report&Financial Statements 2024HighlightsStrategic ReportReports from the DirectorsFinancial State
129、mentsInformation for ShareholdersAllergy Therapeutics,Bonhill,Falanx and Itsarm(formerly In the Style)were also exited as they had become sub-scale positions.After strong performance from the shares in the first half of the period,the opportunity was taken to reduce our large holding in AB Dynamics,
130、the designer and supplier of testing and simulation technology to the automotive industry.This crystallised 2.2m in realised gains from original cost.Profits were also taken in the portfolios largest holding,Keywords Studios,crystallising gains of 1.4m from original cost.With Aurrigos shares reachin
131、g a peak of more than three times the listing price,a small trim was made to the weighting which subsequently provided portfolio flexibility to participate in the placing.In the period,we also reduced our position in Polarean.Recognising that it was likely that the VCT Rules would not allow the Comp
132、any to make further investments in Polarean,the decision was taken to sell part of our holding to Nukem,a long term strategic investor in Polarean.A decision was also taken to reduce our position in Frontier Developments,following a sequence of disappointing game launches plus a step-back to monitor
133、 how the strategic review is executed.Treasury ManagementWith the rise in the Bank of England base interest rate that began in February 2022 with an increase to 0.5%,quickly increasing incrementally to 5.25%by August 2023 at which level it has remained,opportunities to earn a good return on cash bec
134、ame available.Following consultation with the Companys VCT status adviser the decision was taken to allocate a proportion of cash held to overnight or up to 7-day term deposit accounts offering interest rates at or close to central bank base rates with A+rated financial institutions.We placed the ma
135、jority of the remainder with short term money market funds.Such deployment of cash provides an attractive means of generating additional,low-risk income for the Company while awaiting suitable VCT qualifying opportunities.OutlookThe junior end of the UK stock market has been through a traumatic peri
136、od over the last two years,since it peaked in September 2021.In the past a rally in the leading tech stocks in the US tended to filter through to venture capital stage companies in the UK,whether quoted or unquoted.This time,however,the dramatic rise in the leading US tech stocks has exacerbated flo
137、ws of money away from the UK stock market as savers have sought to reallocate capital to these already giant companies.As at the end of March,the VCT qualifying portfolio is roughly split 50/50 in value between a group of 18 relatively mature small and medium sized businesses originally purchased be
138、tween 2005 and 2015.These have been highly profitable investments,even with some of the big share price falls they have seen over the last two years.In managing the VCT we have had a strong tendency to want to preserve these holdings as much as possible,because it will take a long time for investmen
139、ts made under post 2017 VCT rule changes to match them in maturity,scale and quality.The outlook for this group of companies has improved significantly from a year ago,with growth coming through in many cases and a sense that ratings are now bottoming out.This sets up the conditions for a rebound if
140、 UK interest rates fall towards the end of the year,as expected.In general we were too slow to take profits from this part of the portfolio in 2021,having cultivated a strategy of running winners that was highly effective for the prior ten years.The VCT rules are much easier to negotiate with this p
141、olicy of running winners.However,we failed to anticipate exactly how far the deratings could run,and how much some of these companies suffered from downgrades.In general,we are increasing our propensity to take profits from this part of the portfolio where we see significant valuation risk.But as th
142、ings stand,we think the risks are now more biased towards an upwards re-rating and for better growth metrics returning.The other half of the portfolio by value are holdings in around 40 companies which are still at the venture capital stage,loss making or break even,undertaking the long and difficul
143、t journey to sustainable profitability.One of these,Maxcyte,is now NASDAQ listed,having raised sufficient cash to aim for demanding growth targets and to maximise the commercial opportunity it has.In most cases,however,the share prices of this group of companies are distressed.They are more fragile,
144、and their fortunes will depend substantially on hitting corporate targets and de-risking business plans.Where they can do this,the upside from current depressed prices will be significant.For those that dont deliver on expectations then this end of the market is a friendless place.12Amati AIM VCT pl
145、cAnnual Report&Financial Statements 2024We recognise that we have had too much of a tendency to stick with investee companies that fail to meet expectations in the hope that over time they will find their way through to profitable growth,in part because this makes negotiating the severe constraints
146、of the VCT legislation more manageable,especially whilst new investment opportunities have been fewer.In other cases,low levels of liquidity can make it difficult to sell stakes in a meaningful way,but the ability to do so remains one of the attractions of investing in quoted companies.This said,in
147、this part of the portfolio,59%of the holdings by value is in companies that are expected to turn profitable or return to profitability in 2024,and another 31%where this is expected during 2025.Once profitable,these companies have an opportunity to gain a wider investor base on AIM and should see mor
148、e positive share price dynamics.Our experience from previous market downturns is that companies that survive this far tend to come through in better shape than they went in,having had to really hone strategy and cut out non-essential costs.Looking at the impact on the portfolio of the VCT rule chang
149、es in 2016-17 shows that satisfactory returns have been difficult to achieve in the period since then,albeit this is looking back from the point of view of a low point.In some cases the rules and their interpretation(such as the revised implementation of the financial distress rules and the restrict
150、ions on making non-qualifying investments into existing qualifying investments where the rules dont allow qualifying investments to be made)create senseless restrictions on Managers which damage the value that can be delivered to shareholders for no apparent policy benefit.Some changes could be made
151、 that would cost nothing and improve the ways in which VCTs can support venture capital stage companies in the UK.VCTs also play a key role in replenishing the AIM exchange by supporting companies at IPO and through their early phases being quoted,something which is all too easily forgotten when tim
152、es are good.Most policy makers understand the importance of this junior market,and it is to be hoped that whoever forms the next Government will take the time necessary to understand how to rejuvenate it.In the meantime we continue to review with the Board,possible ways of expanding the range of qua
153、lifying investments we can encompass.Dr Paul Jourdan,David Stevenson and Scott McKenzieAmati Global Investors11 April 2024Fund Managers Review(continued)13Amati AIM VCT plcAnnual Report&Financial Statements 2024HighlightsStrategic ReportReports from the DirectorsFinancial StatementsInformation for S
154、hareholdersFund Manager BiographiesAmati Global InvestorsAmati Global Investors is a specialist fund management business based in Edinburgh.It is largely,though not exclusively,focused on UK small and mid-sized companies,with a universe ranging from fully listed constituents of the FTSE Mid 250 and
155、FTSE Small Cap indices,to stocks quoted on the Alternative Investment Market.It is the Manager of Amati AIM VCT(for which it won the 2022 Investment Week VCT AIM Investment Company of the year award).It is also the Manager of the WS Amati UK Listed Smaller Companies Fund,the WS Amati Strategic Metal
156、s Fund,the WS Amati Global Innovation Fund and it also offers an AIM IHT portfolio service.It is incorporated in Scotland and 51%owned by its staff,and 49%owned by Mattioli Woods plc,which invested in the company in February 2017.Amati Global Investors is a signatory to the UK Stewardship Code which
157、 aims to enhance the quality of engagement between investors and companies to help improve long-term risk adjusted returns to shareholders.Amati is also a signatory to the UN-supported Principles for Responsible Investment(PRI).14Amati AIM VCT plcAnnual Report&Financial Statements 2024Paul JourdanFo
158、under and CEODavid StevensonFund ManagerScott McKenzieFund ManagerDr Paul Jourdan is an award winning fund manager,with a strong track record in small cap investment.He co-founded Amati Global Investors following the management buyout of Noble Fund Managers from Noble Group in 2010,having joined Nob
159、le in 2007 as Head of Equities.His fund management career began in 1998 with Stewart Ivory where he gained experience in UK,emerging market and global equities.In 2000,Stewart Ivory was taken over by First State and Paul became manager of what is now the WS Amati UK Listed Smaller Companies Fund.In
160、early 2005,he launched Amati VCT and then also became manager of Amati VCT 2 plc after the investment management contract moved to Amati Global Investors in 2010.In September 2014 Amati launched the Amati AIM IHT Portfolio Service,which Paul co-manages with David Stevenson and Scott McKenzie.Prior t
161、o 1998 Paul worked as a professional violinist,including a four year period with the City of Birmingham Symphony Orchestra.He is a CFA Charterholder,CEO,a director of Amati and a trustee of Clean Trade,a charity registered in England and Wales.David Stevenson joined Amati in 2012.In 2005 he was a co
162、-founding partner of investment boutique Cartesian Capital,which managed a range of retail and institutional UK equity funds in long only and long/short strategies.Prior to that he was Assistant Director at SVM,where he also managed equity products including the UK Opportunities small/midcap fund wh
163、ich was ranked top decile for the 5 year period from inception to 2005.David started his career at KPMG where he qualified as a Chartered Accountant.He latterly specialised in corporate finance,before moving into private equity with Dunedin Fund Managers.David has co-managed both the WS Amati UK Lis
164、ted Smaller Companies Fund and Amati AIM VCT since 2012 and the Amati AIM IHT Portfolio Service since 2014.Scott McKenzie joined Amati in April 2021 and has over 25 years of experience managing UK equity portfolios.His career began in Glasgow at Britannia IM in the early 90s before moving to London
165、with Aviva Investors in 1999.He returned to Scotland in 2005,joining Martin Currie where he remained until 2009.After a period running his own private businesses,he joined Saracen Fund Managers in 2014 where he launched the TB Saracen UK Income fund and also became manager of the TB Saracen UK Alpha
166、 fund.He left Saracen in March 2021 having led both funds to top quartile rankings in their sector.Fund Manager Biographies(continued)15Amati AIM VCT plcAnnual Report&Financial Statements 2024HighlightsStrategic ReportReports from the DirectorsFinancial StatementsInformation for ShareholdersCompany
167、nameOriginal Amati VCT bookcost at 4 May 2018#000Costs*000Aggregate Cost*000Fair value 000Fair value movement in year*000Market Cap mIndustry SectorYieldNTM%of net assetsWaystone Amati UK Listed Smaller Companies Fund3,3316,75710,08811,546(1,286)Financials3.28.1Keywords Studios plc1,32593,8974,1566,
168、777(4,818)1,311.4Information Technology0.14.7AB Dynamics plc11511,7211,8725,706(228)401.4 Industrials0.44.0Learning Technologies Groupplc1,37803,7714,5515,596(4,078)641.4Information Technology2.03.9Craneware plc2,32983,6013,8994,6191,568760.0 Health Care1.43.2Aurrigo International plc12,3052,3054,02
169、038541.2 Industrials2.8MaxCyte Inc.14491,5361,9853,911(802)405.5 Health Care2.7GB Group plc22362,9673,2033,176(802)711.8Information Technology1.52.2Water Intelligence plc21801,0381,2183,014(1,629)64.5 Industrials2.1Fadel Partners,Inc13,0003,0002,937(62)28.5Information Technology2.1Top Ten36,27751,30
170、2(11,752)35.8Chorus Intelligence Limited Ordinary Shares1,4301301151Information Technology0.1Chorus Intelligence Limited 10%Convertible Loan Notes1,42,6992,6992,699Information Technology1.9Solid State plc22592615202,626(83)144.1 Industrials1.71.8Diaceutics plc11,5571,5572,110(41)87.2 Health Care1.5B
171、elvoir Group plc14043797832,07062197.0 Real Estate4.41.5Nexteq plc24193,7774,1962,039(802)77.8Consumer Discretionary1.4Ensilica plc12,4502,4502,009(2,744)33.6Information Technology1.42 Degrees Limited A111,8671,8671,867Information Technology1.32 Degrees Limited A21133133133Information Technology0.1V
172、elocity Composites plc14962,1072,6031,921(523)18.2 Industrials1.4Sosandar plc11,8721,8721,810(1,373)36.0Consumer Discretionary1.3Equals Group plc11,1371,1371,755491221.4Information Technology1.2Top Twenty56,39572,492(16,206)50.7Brooks Macdonald Group plc2,31,1541,1541,658(315)302.5 Financials4.41.2I
173、ntelligent Ultrasound plc12,1942,1941,652(507)24.5 Health Care1.2Northcoders Group plc12,1112,1111,597(1,708)11.6Consumer Discretionary1.1SRT Marine Systems plc17094651,1741,425(347)82.4Information Technology1.0Kinovo plc21,6811,6811,40168940.8 Industrials1.0Investment Portfolioas at 31 January 2024
174、16Amati AIM VCT plcAnnual Report&Financial Statements 2024Company nameOriginal Amati VCT bookcost at 4 May 2018#000Costs*000Aggregate Cost*000Fair value 000Fair value movement in year*000Market Cap mIndustry SectorYieldNTM%of net assetsArecor Therapeutics plc11,9101,9101,393(464)50.5 Health Care1.0T
175、an Delta Systems plc11,8751,8751,298(577)13.2 Industrials0.9Accesso Technology Group plc1,32212211,214(595)229.0Information Technology0.8Property Franchise Group plc(The)2155197352988280108.1 Real Estate4.30.7Itaconix plc12,0002,000941(1,059)16.2 Industrials0.7Eden Research plc11,0571,057921(72)29.3
176、 Materials0.6Saietta Group plc1,35,1005,100805(1,770)21.8Consumer Discretionary0.6Strip Tinning Holdings plc Ordinary shares11,0541,054228(114)7.3 Industrials0.2Strip Tinning Holdings plc 10%Unsecured Convertible Loan Notes1500500500 Industrials0.4One Media iP Group plc11,2401,240709(354)8.9 Financi
177、als0.5Polarean Imaging plc12,0652,065696(3,279)15.1 Health Care 0.5Cordel Group plc1915915641(275)8.4Information Technology0.4Flylogix Limited Ordinary shares1,4300300Information TechnologyFlylogix Limited 10%Convertible Loan Notes1,42,7002,700610(15)Information Technology0.4Getech Group plc11,7001,
178、700580(502)5.1 Energy0.4Netcall plc2110110575(6)154.1Information Technology0.90.4Creo Medical Group plc1,31,6131,613535284150.0 Health Care0.4Frontier Developments plc11972,5092,706518(1,219)57.0Communication Services0.4Block Energy plc13,0003,000511(51)7.3 Energy0.4Ixico plc11,3671,367488(635)4.8 H
179、ealth Care0.3Byotrol plc Ordinary shares1,4511348859138(363)2.5 Materials0.1Byotrol plc 9%Convertible Loan Notes1,4350350350(3)Materials0.2Clean Power Hydrogen plc12,5002,500472(861)22.8 Industrials0.3Science in Sport plc18041,1361,9404314526.4Consumer Staples0.3Hardide plc16951,6662,361430(158)5.6
180、Materials0.3Verici Dx Limited1800800360(80)15.3 Health Care0.3Eneraqua plc11,9551,955282(1,764)13.3 Industrials0.2Synectics plc23423422124127.6Information Technology3.00.1Brighton Pier Group plc(The)1314175489208(61)20.5Consumer Discretionary0.1Zenova Group plc1900900208(357)2.9 Materials0.1Investme
181、nt Portfolio(continued)17Amati AIM VCT plcAnnual Report&Financial Statements 2024HighlightsStrategic ReportReports from the DirectorsFinancial StatementsInformation for ShareholdersCompany nameOriginal Amati VCT bookcost at 4 May 2018#000Costs*000Aggregate Cost*000Fair value 000Fair value movement i
182、n year*000Market Cap mIndustry SectorYieldNTM%of net assetsMyCelx Technologies Corporation14402056452068511.7 Industrials0.1Fusion Antibodies plc15651,8292,394150(953)2.7 Health Care0.1Rosslyn Data Technologies plc16141,3081,922120(127)3.0Information Technology0.1Rua Life Sciences plc193193188(362)7
183、.0 Health Care0.1Trellus Health plc170070079(61)7.3 Health Care0.1Merit Group plc1596596482716.1Communication ServicesAptamer Group plc13,6723,67231(1,161)4.7 Health CareFireAngel Safety Technology Group plc169069031(24)15.1Consumer DiscretionaryInvestments held at nil value2,691(900)Total non-money
184、 marketinvestments123,23198,220(35,854)68.7Money market fundsRoyal London Short Term Money Market Fund14,34714,4177010.1Goldman Sachs Sterling Liquid Reserves Fund8,0658,0655.6Northern Trust Global The Sterling Fund8,0658,0655.6Total money market funds30,47730,5477021.3Total investments153,708128,76
185、7(35,784)90.0Other net current assets14,31110.0Net assets143,078100.01 Qualifying holdings.2 Part qualifying holdings.3 These investments are also held by other funds managed by Amati.4 The investments of Ordinary Shares and Convertible loan notes:Flylogix Limited(“Flylogix”)consists of 392 Ordinary
186、 Shares in Flylogix at fair value of nil and 10%Convertible Loan Notes(“CLNs”)at 610,000.The company was put into administration on 2 March 2023.The Convertible Loan Note agreement prescribes that if Flylogix is not listed on AIM,interest is payable at 10%per annum for a term of 5 years.The fair val
187、ue of the CLNs is that amount which the administrator has indicated should be payable including interest.Elexsys Energy plc(“Elexsys”)consists of 202,737 Ordinary Shares in Elexsys at fair value of nil and 8%Convertible Loan Notes at nil.Chorus Intelligence Limited(“Chorus”)consists of 232 Ordinary
188、Shares in Chorus at fair value of 151,000 and 10%Convertible Loan Notes at 2,699,000.Byotrol plc(“Byotrol”)consists of 25,000,001 Ordinary Shares in Byotrol at fair value of 138,000 and 9%Convertible Loan Notes at 350,000.Interest is being received quarterly on the Byotrol CLNs.Strip Tinning consist
189、s of 569,699 ordinary shares at fair value of 228,000 and 10%Convertible Loan Notes at 500,000.Interest is payable upon redemption of the CLNs.#This column shows the original book cost of the investments acquired from Amati VCT plc on 4 May 2018.*This column shows the bookcost to the Company as a re
190、sult of market trades and events.*This column shows the aggregate book cost to the Company either as a result of trades and events or asset acquisition from Amati VCT plc on 4 May 2018.*This column shows the movement in fair value,the unrealised gains/(losses)on investments during the year,see notes
191、 1 and 8 on pages 61 and 68 for further details.NTM Next twelve months consensus estimate(Source:Refinitiv,Fidessa and Amati Global Investors)The Manager rebates the management fee of 0.75%on the WS Amati UK Listed Smaller Companies Fund and this is included in the yield.All holdings are in ordinary
192、 shares unless otherwise stated.Investments held at nil value:Celoxica Holdings plc1,Elexsys Energy plc,L Limited1(previously The S Limited),Rated People Limited1,Sorbic International plc,TCOM Limited1,VITEC Global Limited1.As at the year end the percentage of the Companys portfolio held in qualifyi
193、ng holdings for the purposes of Section 274 of the Income and Corporation Taxes Act is 100%.18Amati AIM VCT plcAnnual Report&Financial Statements 2024200020032005200720092011201320152017201920212023 1,600 1,400 1,200 1,000 800 600 400 2000Market Capitalisation(m)KeywordsStudiosGPGroupLearningTechnol
194、ogiesABDynamicsMaxcyteCranewareAurrigoFadelPartnersChorusCLNWaterIntelligenceInformationTechnologyHealth careConsumerDiscretionaryFinancialsIndustrialsComm-unicationServicesEnergyMaterialsReal EstateConsumerStaplesCash and moneymarket funds%051015202530Analysis as at 31 January 2024Qualifying portfo
195、lioThe portfolio of qualifying investments in the Company as at 31 January 2024 is analysed in the graph below by date of initial investment and market capitalisation.The size of the circles represents the relative size of the holdings in the portfolio by value.The top ten qualifying portfolio compa
196、nies are labelled.The dates of investments in securities held solely by Amati VCT plc prior to the merger with Amati VCT 2 plc in May 2018,are given as the dates those securities were originally acquired by Amati VCT plc.Sector splitThe portfolio of investments in the Company as at 31 January 2024 i
197、s analysed in the graph below by sector.This includes a sector split of the investments within the WS Amati UK Listed Smaller Companies Fund which in the Investment Portfolio table on pages 15 to 17 is classed as Financials.Source:Amati Global Investorsas at 31 January 2024Investment Portfolio(conti
198、nued)19Amati AIM VCT plcAnnual Report&Financial Statements 2024HighlightsStrategic ReportReports from the DirectorsFinancial StatementsInformation for ShareholdersInvestment Policy,Investment Objectives and Investment StrategyInvestment ObjectivesThe investment objectives of the Company are to gener
199、ate tax free capital gains and regular dividend income for its shareholders while complying with the requirements of the rules and regulations applicable to Venture Capital Trusts(“VCTs”).Investment PolicyThe Companys investment policy is to hold a diversified portfolio across a broad range of secto
200、rs to mitigate risk.It makes Qualifying Investments(as defined in the Income Tax Act 2007(as amended)primarily in companies traded on AIM or on the Aquis stock exchange(“Aquis”)and non-Qualifying Investments as allowed by the VCT legislation.The Company manages its portfolio to comply with the requi
201、rements of the rules and regulations applicable to VCTs.Investment ParametersWhilst the investment policy is to make Qualifying Investments primarily in companies traded on AIM or on Aquis,the Company may also make Qualifying Investments in companies likely to seek a quotation on AIM or Aquis.With r
202、egard to the non-Qualifying portfolio the Company makes investments which are permitted under the VCT legislation,including shares or units in an Alternative Investment Fund(AIF)or an Undertaking for Collective Investment in Transferable Securities(UCITS)fund,and shares in other companies which are
203、listed on a regulated market such as the Main Market of the London Stock Exchange.Any investments by the Company in shares or securities of another company must not represent more than 15%of the Companys net asset value at the time of purchase.BorrowingThe Company has the flexibility to borrow money
204、 up to an amount equal to its adjusted capital and reserves but the Boards policy is not to enter into borrowings.Investment Strategy for Achieving ObjectivesThe investment strategy for achieving the Company Objectives which follows is not part of the formal Investment Policy.Any material amendment
205、to the formal Investment Policy may only be made with shareholder consent,but that consent applies only to the formal Investment Policy above and not to any part of the Strategy for Achieving Objectives or Key Performance Indicators below.(a)Qualifying Investments Strategy The Company is likely to b
206、e a long-term investor in most Qualifying Investments,with sales generally only being made where an investment case has deteriorated or been found to be flawed,or to realise profits,adjust portfolio weightings,fund new investments or pay dividends.Construction of the portfolio of Qualifying Investme
207、nts is driven by the historic investments made by the Company and by the availability of suitable new investment opportunities.The Manager may co-invest in companies in which other funds managed by Amati Global Investors invest.(b)Non-Qualifying Investments Strategy The assets of the portfolio which
208、 are not in Qualifying Investments will be invested by the Manager on behalf of the Company in investments which are allowable under the rules applicable to VCTs.Currently,cash not needed in the short term is invested in a combination of the following(though ensuring that no more than 15%of the Comp
209、anys funds are invested in any one entity at the time of purchase):(i)the WS Amati UK Listed Smaller Companies Fund(which is a UCITS fund),or other UCITS funds approved by the Board;(ii)direct equity investments in small and mid-sized companies and debt securities in each case listed on the Main Mar
210、ket of the London Stock Exchange;and(iii)cash or cash equivalents(including money market funds)which are redeemable within 7 days.20Amati AIM VCT plcAnnual Report&Financial Statements 2024Environmental,Social and Governance(“ESG”)PoliciesThe Investment Manager recognises that managing investments on
211、 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 Amati has been an active participant in seeking to define and strengthen its principles accor
212、dingly.This involves both integrating ESG considerations into the Investment Managers investment decision-making process as a matter of course,and also signing up to major external bodies who are leading influencers in the formation of industry best practice.The following is an outline of the kinds
213、of ESG factors that the Investment Manager will consider and question as part of its investment process,reflecting the specific inputs and outputs of a business.Environmental climate change;use of natural resources;pollution;waste and impact on bio-diversity;and taking into account any positive envi
214、ronmental impacts.Social use of human capital;potential product or service liabilities;stakeholder opposition;and taking into account any positive social considerations.Governance ownership and control;management structure and quality;pay and alignment;accounting issues;business ethics;and tax trans
215、parency.Human rights weighing up the risks of activities in countries with Freedom House Scores below 33 and based on Clean Trade principles;not investing in companies extracting natural resources in countries which score below 15;risk of exposure to corruption and unreliable legal frameworks;risk o
216、f benefiting from slave labour;risk from adverse political developments impacting a business negatively.The Board is conscious of the potential impact of its investments on the environment as well as its social and governance responsibilities.The Board and the Manager believe that sustainable invest
217、ment involves the integration of ESG factors within the investment appraisal process and that these factors should be considered alongside strategic,commercial and financial issues.Further details can be found on page 28.Board Diversity of Investee CompaniesThe Board,through the Manager,considers bo
218、ard diversity to be an important consideration in its investment decision on investee companies.Key Performance IndicatorsThe Board expects the Manager to deliver a performancewhich meets the objectives of the Company.A review of the Companys performance during the financial year,the position of the
219、 Company atthe year end and the outlook for the coming year is contained in the Chairmans Statement and Fund Managers Review.The Board monitors on a regular basis a number of key performance indicators which aretypical for VCTs,the main ones being:Compliance with HMRC VCT regulations to maintainthe
220、Companys VCT Status.See page 29;Net asset value and total return to shareholders(the aggregate of net asset value and cumulative dividends paid to shareholders,assuming dividendsre-invested at ex-dividend date).See graphs on page 3;Comparison against the Deutsche Numis Alternative Markets Total Retu
221、rn Index.See graph on page 3;Dividend distributions.See table of investor returns onpage 2;Share price.See key data on page 1;and Ongoing charges ratio.See key data on page 1.Investment Policy,Investment Objectives and Investment Strategy(continued)21Amati AIM VCT plcAnnual Report&Financial Statemen
222、ts 2024HighlightsStrategic ReportReports from the DirectorsFinancial StatementsInformation for ShareholdersFund Management and Key ContractsManagement AgreementAmati Global Investors was appointed as Manager to the Company on 19 March 2010.Under an Investment Management and Administration Agreement
223、dated 19 March 2010,and subsequently revised and updated in two separate agreements,an Investment Management Deed(“IMA”)and a Fund Administration,Secretarial Services and Fund Accounting Agreement(“FASSFAA”),on 30 September 2019,the Manager agreed to manage the investments and other assets of the Co
224、mpany on a discretionary basis subject to the overall policy of the Directors.The Company will pay to the Manager under the terms of the IMA a fee of 1.75%of the net asset value of the Company quarterly in arrears.In November 2014,with shareholder consent,the Company amended its non-qualifying inves
225、tment policy to permit investment in the WS Amati UK Listed Smaller Companies Fund,a small and mid-cap fund managed by the Manager.The Company receives a full rebate on the fees payable by the Company to the Manager within this fund either through a reduction of fees payable by the Company or a dire
226、ct payment by the Manager.Annual running costs are capped at 3.5%of the Companys net assets,any excess being met by the Manager by way of a reduction in future management fees.The annual running costs include the Directors and Managers fees,professional fees and the costs incurred by the Company in
227、the ordinary course of its business(but excluding any commissions paid by the Company in relation to any offers for subscription,irrecoverable VAT and exceptional costs,including winding-up costs).No performance fee is payable as the Manager waived all performance fees from 31 July 2014 onwards.Admi
228、nistration ArrangementsUnder the terms of the FASSFAA,the Investment Manager also agreed to provide certain fund administration,company secretarial and accounting services to the Company.As disclosed previously,the Manager and Board agreed that a new Company Secretary would be sought and that the Bo
229、ard would contract directly with the new Company Secretary.The Board appointed Law Debenture as Company Secretary of the Company with effect from 1 February 2022.Under the FASSFAA,the Investment Manager has the right to appoint suitable representatives to provide fund accounting and administration s
230、ervices to the Company.The Manager engages Link Alternative Fund Administrators Limited to act as fund accountant and administrator.For the year ending 31 January 2024 the Company agreed to pay to the Investment Manager a fee of 78,336(2023:72,000)quarterly in arrears in respect of the provision of
231、fund accounting and administration services.This fee is subject to an annual increase in line with the consumer prices index.The appointment of the Investment Manager as investment manager and/or fund accountant and administrator may be terminated with twelve months notice.Where the Investment Manag
232、er negotiates and structures an investment directly with a company,most commonly as a convertible loan,the Investment Manager retains the right to charge the investee company a fee.Any legal expenses incurred by the Investment Manager will be paid out of this fee.Fund Managers EngagementThe Board re
233、gularly appraises the performance and effectiveness of the managerial,administration and secretarial arrangements of the Company.As part of this process,the Board will consider the arrangements for the provision of investment management and other services to the Company on an ongoing basis and a for
234、mal review is conducted annually.In the opinion of the Board,the continuing appointment of the Manager,on the terms agreed,is in the interests of the shareholders.The Directors are satisfied that the Manager will continue to manage the Company in a way which will enable the Company to achieve its ob
235、jectives.VCT Status AdviserPhilip Hare&Associates LLP(“Philip Hare&Associates”)is engaged to advise the Company on compliance with VCT requirements.Philip Hare&Associates review new investment opportunities,as appropriate,and review regularly the investment portfolio of the Company.Philip Hare&Assoc
236、iates work closely with the Manager but report directly to the Board.22Amati AIM VCT plcAnnual Report&Financial Statements 2024Principal and Emerging RisksThe Audit Committee regularly reviews the Companys risk register,which assesses each risk and classifies the likelihood of the risk and the poten
237、tial impact of each risk on the Company.The Board considers that the Company faces the following major risks and uncertainties:Potential RiskPotential ImpactMitigationInvestment RiskA substantial portion of the Companys investments is in small AIM traded companies as well as some unquoted companies.
238、By their nature these investments involve a higher degree of risk than investments in larger fully listed companies.These companies tend to have limited product lines and niche markets.They can be reliant on a few key individuals.They can be dependent on securing further financing.With the changes t
239、o VCT regulations introduced in the Finance Act 2018 focusing investment in knowledge based companies,newer investments may well be made at an earlier stage in the lifecycle and may result in a reduced exposure to asset based businesses leading to increased volatility in the value of an investee com
240、panys shares.Further,the majority of the new investments will be in companies which have invested in developing and commercialising intellectual property,which brings with it the risk that another company might develop superior technology,or that the commercialisation strategy may fail.In addition,t
241、he liquidity of these shares can be low and the share prices volatile.The Board places reliance upon the skills and expertise of the Manager,including its strong track record for investing in this segment of the market.Investments are actively and regularly monitored by the Manager and the Board rec
242、eives detailed reports on the portfolio in addition to the Managers report at regular Board meetings.The Manager also seeks to limit these risks through building a diversified portfolio with companies in different areas within sectors and markets at different stages of development.Investments in unq
243、uoted companies in particular are subject to strict controls and investment limits in recognition of the significant risks involved.In relation to investments of this nature there is an expectation that the investee company is likely to seek admission to AIM,in order to de-risk the investment,to the
244、 extent that this is possible,within an acceptable time frame.It may be that an investment is realised via a trade sale as this option is always a possibility.The Manager ensures Board representation or monitoring is a requirement of the investment agreement and,if a listing or trade sale does not o
245、ccur,will continue to oversee board and operational management performance.23Amati AIM VCT plcAnnual Report&Financial Statements 2024HighlightsStrategic ReportReports from the DirectorsFinancial StatementsInformation for ShareholdersPotential RiskPotential ImpactMitigationVenture Capital Trust Appro
246、val RiskThe current approval as a venture capital trust allows investors to take advantage of income tax reliefs on initial investment and ongoing tax-free capital gains and dividend income.Failure to meet the qualifying requirements could result in investors losing the income tax relief on initial
247、investment and loss of tax relief on any tax-free income or capital gains received.In addition,failure to meet the qualifying requirements could result in a loss of listing of the shares.The VCT legislation contains a“sunset clause”which would have brought income tax relief to an end on 5April 2025.
248、Following confirmation by the Chancellor in his Autumn statement that the scheme will continue,the Finance Act has now been passed which allows VCT income tax relief to be available for subscriptions for VCT shares until 5 April 2035.This however can only come into force when the EU gives approval.T
249、he Board understands that HM Treasury officials expect approval to be given,but the timescale for this is not yet known.To reduce this risk,the Board has appointed the Manager which has significant experience in venture capital trust management and is used to operating within the requirements of the
250、 venture capital trust legislation.In addition,to provide further formal reassurance,the Board has appointed Philip Hare&Associates as VCT Status Adviser to the Company.Philip Hare&Associates reports every six months to the Board to confirm compliance with the venture capital legislation,to highligh
251、t areas of risk and to inform on changes in legislation independently.Other tax reliefs such as tax-free dividends and exemption from capital gains tax would remain unaffected by the sunset clause.Compliance RiskThe Company has a premium listing on the London Stock Exchange and is required to comply
252、 with the rules of the UK Listing Authority,as well as with the Companies Act,Financial Reporting Standards and other legislation.Failure to comply with these regulations could result in a delisting of the Companys shares,or other penalties under the Companies Acts or from financial reporting oversi
253、ght bodies.The Alternative Investment Fund Managers(Amendment etc.)(EU Exit)Regulations 2019(“AIFMD”)is a directive affecting the regulation of VCTs.Amati AIM VCT has been entered in the register of small,registered UK AIFMs on the Financial Services register at the Financial Conduct Authority(“FCA”
254、).As a registered firm there are a number of regulatory obligations and reporting requirements which must be met in order to maintain its status as an AIFM.Board members and the Manager have considerable experience of operating at senior levels within quoted businesses.In addition,the Board and the
255、Manager receive regular updates on new regulations from the auditor,lawyers,the Company Secretary and other professional bodies.24Amati AIM VCT plcAnnual Report&Financial Statements 2024Potential RiskPotential ImpactMitigationInternal Control RiskFailures in key controls within the Board or within t
256、he Managers business could put assets of the Company at risk or result in reduced or inaccurate information being passed to the Board or to shareholders or to other stakeholders.Inadequate or failed controls might result in breaches of regulations or loss of shareholder trust.The Manager operates a
257、robust risk management system which is reviewed regularly to ensure the controls in place are effective in reducing or eliminating risks to the Company.Details of the Companys internal controls are on page 41.The Board seeks to mitigate the internal control risk by setting policy,regular reviews of
258、performance by the Manager and service providers,enforcement of contractual obligations and monitoring progress and compliance.Financial RiskBy its nature,as a venture capital trust,the Company is exposed to market price risk,credit risk,liquidity risk and interest rate risk.The Company has from tim
259、e to time been exposed to currency risk.The Companys policies for managing these risks are outlined in full in notes 16 to 19 to the financial statements on pages 73 to 75.The Company is financed wholly through equity.Economic RiskEvents such as economic recession,not only in the UK,but also in the
260、core markets relevant to our investee companies,together with a movement in interest rates,can affect investor sentiment towards liquidity risk,and hence have a negative impact on the valuation of smaller companies.The economic future for the UK and the wider world would appear to be as uncertain as
261、 it has ever been in the last few decades.Wars in Europe and the Middle East combine to give grave concern for the future.This follows two years of the Covid-19 pandemic and the ensuing impacts on the UK and global economies,where government debt has not been as high as it is now since World War 2.G
262、overnment actions to deal with Covid-19 and to boost the economy during the pandemic resulted in rising inflation and therefore interest rates,the impacts on theThe Manager seeks to mitigate economic risk by seeking to adopt a suitable investment style for the current point in the business cycle,and
263、 to diversify the exposure to geographic end markets.Principal and Emerging Risks(continued)25Amati AIM VCT plcAnnual Report&Financial Statements 2024HighlightsStrategic ReportReports from the DirectorsFinancial StatementsInformation for ShareholdersPotential RiskPotential ImpactMitigationEconomic R
264、isk(continued)cost of living being exacerbated by high energy prices caused by poor Government energy policy decision-making in the rush to go green,reliance for energy supplies on Russia and the impact of that countrys invasion of Ukraine.The Covid-19 pandemic and the measures taken to control the
265、outbreak had already led to volatility in stock markets and other financial markets in the UK and a downturn in the UK economy.Operational RiskFailure of the Managers,or other contracted third parties,accounting systems or disruption to their businesses might lead to an inability to provide accurate
266、 reporting and monitoring or loss to shareholders.The Manager regularly reviews the performance of third-party suppliers at monthly management meetings and the Nomination Committee of the Company considers third-party suppliers performance annually.The Board considers the Managers performance at eve
267、ry quarterly meeting.Concentration RiskAlthough the Company has a diversified portfolio of investments,the twenty largest investments account for just over half of the total investments.A material fall in any one non-money market investment can have a significant impact on the overall net asset valu
268、e.Portfolio weighting limits apply to the portfolios largest holdings such that no holding is allowed to approach a size of 10%of the portfolio,with action normally taken well before that level particularly where the shares have become overbought with no underlying earnings justification.26Amati AIM
269、 VCT plcAnnual Report&Financial Statements 2024Section 172 Statement Directors Duty to Promote the Success of the CompanyThis section sets out the Companys Section 172 Statement and should be read in conjunction with the other contents of the Strategic Report.The Directors have a duty to promote the
270、 success of the Company for the benefit of its members as a whole and in doing so to have regard to a number of matters including:the likely consequences of any decision in the long term;the interests of the Companys employees;the need to foster business relationships with suppliers,customers and ot
271、hers;the impact of the companys operations on the community and the environment;the desirability of the Company maintaining a reputation for high standards of business conduct;and the need to act fairly between members of the Company.As an externally managed investment company,the Company does not h
272、ave employees.Its main stakeholders therefore comprise the shareholders,the Investment Manager,other service providers and investee companies.To ensure that the Directors are aware of,and understand,their duties they are provided with a tailored induction,including details of all relevant regulatory
273、 and legal duties as a Director of a UK public limited company when they first join the Board,and continue to receive regular and ongoing updates and training on relevant legislative and regulatory developments.They also have continued access to the advice and services of the Company Secretary,and w
274、hen deemed necessary,the Directors can seek independent professional advice.The Terms of Reference of the Boards committees are reviewed annually and describe the Directors responsibilities and obligations and include any statutory and regulatory duties.StakeholderImportanceBoard EngagementSharehold
275、ersContinued shareholder support and engagement are critical to the continuing existence of the business and its future growth.The Board places great importance on communication with its shareholders and encourages shareholders to attend the AGM and an annual investor event and welcomes communicatio
276、n from shareholders as described more fully on page 39 in the Statement of Corporate Governance.Investment ManagerThe Managers performance is fundamental for the Company to successfully deliver its investment strategy,meet its investment objective and its long-term success.The Boards decisions are i
277、ntended to achieve the Companys objective to generate tax free capital gains and income on investors funds and maintaining the Companys status as a VCT is a critical element of this.The Board regularly monitors the Companys performance in relation to its investment objectives and seeks to maintain a
278、 constructive working relationship with the Manager.Representatives of the Manager attend each quarterly board meeting and provide an update on the investment portfolio along with presenting on macroeconomic issues.The Board also expects good standards at the companies within which the Company is in
279、vested and,as described on page 28,the Manager remains a signatory to the UK Stewardship Code,and the Principles for Responsible Investment.27Amati AIM VCT plcAnnual Report&Financial Statements 2024HighlightsStrategic ReportReports from the DirectorsFinancial StatementsInformation for ShareholdersSt
280、akeholderImportanceBoard EngagementOther service providersincluding:the registrar,the receiving agent,the tax adviser,the auditor,the lawyers,the Company Secretary and the Fund AccountantIn order to function as an investment trust with a premium listing on the London Stock Exchange,the Company engag
281、es a diverse and experienced range of advisors for support with meeting all relevant obligations.The Board maintains regular contact with its key external service providers,and the quality of the provision of these services is considered by the Board at Board meetings,as well as being subject to a m
282、ore formal annual review of both performance and fees by the Remuneration Committee.Investee companiesThe Companys performance is directly linked to the performance of its underlying investee companies and accordingly communication with those entities is regarded as very important.The Manager does n
283、ot have board representation in any quoted investee company but does interact with Directors and senior management of quoted investee companies regularly.The Manager does ensure direct or indirect representation is achieved on the boards of unquoted companies.The Boards primary focus in promoting th
284、e long-term success of the Company for the benefit of the members as a whole is to direct the Company with a view to achieving the investment objective in a manner consistent with its stated investment policy and strategy.Key decision makingThe mechanisms for engaging with stakeholders are kept unde
285、r review by the Directors and discussed at Board meetings to ensure they remain effective.The Board has policies for dividends,share buybacks and the dividend re-investment scheme,all of which it is considered are for the benefit of shareholders.During the year the Directors discussed these and reaf
286、firmed their commitment to the policies.An example of a principal decision made during the year,and how the Board fulfilled its duties under Section 172,is set out below:Principal DecisionLong-term impactStakeholder EngagementSecond Interim DividendPayment of a second interim dividend gave additiona
287、l comfort that the 80%test would be maintained,given the challenging market conditions,which had resulted in fewer fund raises on AIM this year.The Board considered how shareholders would receive a second interim dividend,but agreed that such a payment remained within the dividend policy and was in
288、line with market practice,noting that other peer VCTs had also paid second interim dividends.28Amati AIM VCT plcAnnual Report&Financial Statements 2024Environmental,Social and Governance(“ESG”)Policies,and Responsible OwnershipThe Company has no employees and no premises and the Board has decided th
289、at the direct impact of its activities is minimal;therefore it has no policies relating to social,community and human rights issues.However,the Board does consider the impact of its operations on the environment and over the past couple of years the Board made the decisions to no longer pay all cash
290、 dividends via cheque and to no longer provide printed copies of the Companys Half-Yearly report in order to reduce the use of paper.The Company engaged with its shareholders on the matter.The Companys indirect impact occurs through the range of organisations in which it invests and for this it foll
291、ows a policy of Responsible Ownership.In terms of external validation and support,Amati Global Investors,the Manager,is signatory to the UK Stewardship Code which aims to enhance the quality of engagement between investors and companies to help improve long-term risk adjusted returns to shareholders
292、.Amatis approach to Stewardship and Shareholder Engagement can be found at https:/ is also a signatory to the UN-supported Principles for Responsible Investment(PRI),which works to support its international network of signatories in incorporating ESG factors into their investment and ownership decis
293、ions.The PRI acts in the long-term interests of its signatories,of the financial markets and economies in which they operate and ultimately of the environment and society as a whole.Voting on portfolio investmentsIn 2023,the Manager voted in respect of 59 Amati AIM VCT holdings at 78 company meeting
294、s on a range of ESG issues.Business ConductThe Board takes its responsibility to prevent bribery very seriously and has a zero-tolerance policy towards bribery.It has committed to carry out all business in an honest and ethical manner and to act professionally,fairly and with integrity in all its bu
295、siness dealings and relationships.The Manager has its own anti-bribery and corruption policy.Global Greenhouse Gas EmissionsThe Company is a low energy user and is therefore exempt from the reporting obligations under the Companies Act 2006(Strategic Report and Directors Report)Regulations 2013 or t
296、he Companies(Directors Report)and Limited Liability Partnerships(Energy and Carbon Report)Regulations 2018,implementing the UK Governments policy on Streamlined Energy and Carbon Reporting.The Company has no greenhouse gas emissions or energy consumption to report from the operations of the Company,
297、nor does it have responsibility for any other emission producing sources.Under listing rule 15.4.29(R),the Company,as a closed ended investment fund,is currently exempt from complying with the Task Force on Climate related Financial Disclosures.Section 172 StatementDirectors Duty to Promote the Succ
298、essof the Company(continued)29Amati AIM VCT plcAnnual Report&Financial Statements 2024HighlightsStrategic ReportReports from the DirectorsFinancial StatementsInformation for ShareholdersVCT RegulationsThe Companys investment policy is designed to ensure that it meets the requirements of HM Revenue&C
299、ustoms to qualify and to maintain approval as a VCT:(i)The Company must,within three years of raising funds,maintain at least 80%of its investments by VCT value(cost,or the last price paid per share,if there is an addition to the holding)in shares or securities comprised in qualifying holdings(this
300、percentage rose from 70%to 80%for accounting periods beginning on or after 6 April 2019 which for the Company was from 1 February 2020).At least 70%by VCT value must be ordinary shares which carry no preferential rights.A further condition requires that 30%of new funds raised in accounting periods b
301、eginning after 5 April 2018 are to be invested in qualifying holdings within 12 months of the accounting period following the issuance of shares;(ii)The Company may not invest more than 15%of its investments in a single company and it must have at least 10%by VCT value of its total investments in an
302、y qualifying company in qualifying shares approved by HM Revenue&Customs;(iii)To be classed as a VCT qualifying holding,companies in which investments are made must have no more than 15 million of gross assets at the time of investment and 16 million after investment;they must be carrying on a quali
303、fying trade and satisfy a number of other tests including those outlined below;the investment must also be made for the purpose of promoting growth or development;(iv)VCTs may not invest new capital in a company which has raised in excess of 5 million(10 million from 6 April 2018 if the company is d
304、eemed to be a Knowledge Intensive Company)from all sources of state-aided capital within the 12 months prior to and including the date of investment;(v)No investment may be made by a VCT in a company that causes that company to receive more than 12 million(20 million if the company is deemed to be a
305、 Knowledge Intensive Company)of state-aid investment(including from VCTs)over the companys lifetime.A subsequent acquisition by the investee company of another company that has previously received State-Aid Risk Finance can cause the lifetime limit to be exceeded;(vi)No investment can be made by a V
306、CT in a company whose first commercial sale was more than 7 years prior to date of investment,except where previous State-Aid Risk Finance was received by the company within 7 years(10 year in each case for a Knowledge Intensive Company)or where both a turnover test is satisfied and the money is bei
307、ng used to enter a new product or geographical market;(vii)No funds received from an investment into a company can be used to acquire another existing business or trade;(viii)Since 6 April 2016 a VCT must not make“nonqualifying”investments except for certain specified investments held for liquidity
308、purposes and redeemable within seven days.These include investments in UCITS(Undertakings for Collective Investments in Transferable Securities)funds,AIF(Alternative Investment Funds)and in shares and securities purchased on a Regulated Market.In each of these cases the restrictions in(iii)(vii)abov
309、e are not applied;and(ix)Non-qualifying investments in AIM-quoted shares are not permitted as AIM is not a Regulated Market.During 2018,HMRC stopped issuing pre-clearance letters for VCT investments.They are encouraging VCTs not to use the advance assurance service for investments and have stated th
310、at where a VCT has taken reasonable steps to ensure an investment is qualifying,the VCT status will not be withdrawn where an investment is ultimately found to be non-qualifying.The Manager and the Board rely on advice from Philip Hare&Associates regarding the qualifying status of new investments.Th
311、e Manager monitors compliance with VCT qualifying rules on a day-to-day basis through a combination of automated and manual compliance checks in place within the business.Philip Hare&Associates also review the portfolio bi-annually to ensure the Manager has complied with regulations and has reported
312、 to the Board that the VCT has met the necessary requirements during the year.Other Matters30Amati AIM VCT plcAnnual Report&Financial Statements 2024PRIIPs RegulationsThe Company is required to publish a Key Information Document(KID),which sets out the key features,risks,potential future performance
313、 and costs of PRIIPs(Packaged Retail and Insurance-based Investment Products).This document is available at the website of Amati Global Investors:.Statement on Long-term ViabilityIn accordance with the UK Corporate Governance Code published in July 2018(the“Code”),the Directors have carried out a ro
314、bust assessment of the prospects of the Company for the period to January 2029,taking into account the Companys performance and emerging and principal risks,and are of the opinion that,at the time of approving the financial statements there is a reasonable expectation that the Company will be able t
315、o continue in operation and meet liabilities as they fall due over that period.To come to this conclusion the Manager prepares and the Directors consider an income statement and cash flow forecast for the next five years,which is considered to be an appropriate time period due to its consistency wit
316、h the UK Governments tax relief minimum holding period for an investment in a VCT.This time frame allows for forecasts to be made to allow the Board to provide shareholders with reasonable assurance over the viability of the Company.In making their assessment the Directors have taken into account th
317、e nature of the Companys business and Investment Policy,its risk management policies,the diversification of its portfolio,the cash holdings and the liquidity of non-qualifying investments.The Directors have considered in particular the likely economic effects and the impacts on the Companys operatio
318、ns of the war taking place in Ukraine,rising inflation and interest rates.The longer-term economic outlook is very difficult to predict but in considering preparing the long term viability of the Company the Directors noted the Company holds a portfolio of liquid investments and cash balances whose
319、value is a multiple of liabilities.Other DisclosuresThe Company had no employees during the year and has three non-executive directors,two of whom are female and one is male.On behalf of the BoardFiona WollocombeChairman11 April 2024Other Matters(continued)31Amati AIM VCT plcAnnual Report&Financial
320、Statements 2024HighlightsStrategic ReportReports from the DirectorsFinancial StatementsInformation for ShareholdersFiona WollocombeChairman of the BoardBrian ScoulerNon-Executive Director and Chairman of the Audit CommitteeJulia HendersonNon-Executive Director and Chairman of the Remuneration and No
321、minations CommitteesFiona Wollocombe was appointed to the Board in June 2021 and was appointed Chairman at the end of the AGM in June 2022.She is also chairman of Kings Arms Yard VCT plc and trustee of the Scottish Ballet Endowment Fund.Her previous career was in equity capital markets at NatWest Ma
322、rkets and Deutsche Bank.She has previously held non-executive director roles for a number of other companies in the VCT sector including being chairman of Artemis VCT Plc and of Maven Income and Growth VCT PLC.Relevant skills and experience and reasons for re-election:Fiona brings strong banking,fin
323、ancial and investment trust skills to the Board.Her extensive knowledge and experience within the VCT industry help facilitate open conversation,constructive challenge of the Manager,and contribute to strategic discussions in her role as Chairman of the Board.Following a comprehensive board evaluati
324、on process,the board agreed that Fiona continues to be an effective Chairman and member of the Board.Brian Scouler joined the Board in May 2018.Prior to this he was a non-executive director of Amati VCT plc which merged with the Company in May 2018.He spent 25 years in Private Equity in senior roles
325、 with Charterhouse,Royal Bank of Scotland and Dunedin.He has wide experience of buying and selling private companies and investment portfolio management,sitting on numerous investee company boards.He was formerly manager of a quoted investment trust and a member of the steering committee of LPEQ,the
326、 listed private equity group.He is a Chartered Accountant.Relevant skills and experience and reasons for re-election:Brians experience in company and investment portfolio management brings valuable business and financial skills to the Board.This enables him to assess the financial position of the Co
327、mpany and its projections,and to lead discussions regarding the Companys risk management framework and risk appetite.Brians experience of managing audit relationships helps inform his role as Chairman of the Audit Committee.Following a comprehensive board evaluation process,the board agreed that Bri
328、an continues to be an effective member of the Board.Julia Henderson joined the Board in May 2018.Prior to this she was a non executive director of Amati VCT plc which merged with the Company in May 2018.She has specialised in advising quoted and unquoted companies for over thirty years.Her corporate
329、 finance career began at ANZ Merchant Bank after which she became a co-founder and a director of Beeson Gregory Limited,a mid-market investment bank.Since 2004 she has been an independent consultant,chairman and non-executive director to companies across a broad range of sectors.Previous non-executi
330、ve directorships include Alkane Energy plc,ECO Animal Health Group plc,GTL Resources plc and TP Group plc.Relevant skills and experience and reasons for re-election:Julias extensive experience in investment banking and as a non-executive director provides valuable insight to the board.Her experience
331、 aids constructive challenge in the boardroom.Following a comprehensive board evaluation process,the board agreed that Julia continues to be an effective member of the Board.Board of Directors32Amati AIM VCT plcAnnual Report&Financial Statements 2024Directors ReportThe Statement of Corporate Governa
332、nce on pages 36 to 39 forms part of the Directors Report.Principal Activity and StatusThe Company is registered as a public limited company under the Companies Act 2006(Registration number 04138683).The address of the registered office is 8thFloor,100 Bishopsgate,London EC2N 4AG.The principal activi
333、ty of the Company is to invest in a portfolio of companies whose shares are primarily traded on AIM.The Directors have managed,and intend to continue to manage,the Companys affairs in such a manner as to comply with section 274 of the Income Tax Act 2007.A review of the Companys business during the year is contained in the Chairmans Statement and Fund Managers Review.DirectorsThe Directors of the
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