St Helens Private Equity Plc
LSE : SHPE

November 18, 2010 03:00 ET

Preliminary Final Results for the year ended 30 September 2010

                                                                                       18 November 2010


                                     ST HELEN'S PRIVATE EQUITY PLC
                                       ("SHPE" or "the Company")
                                          (PLUS SYMBOL: SHPE)


                    PRELIMINARY FINAL RESULTS FOR THE YEAR ENDED 30 SEPTEMBER 2010


St  Helen's  Private  Equity  Plc the Pre-IPO, Special Situations and 'Small  cap'  investment  company
announces Preliminary annual results for the year ended 30 September 2010.

FINANCIAL HIGHLIGHTS

Turnover:                             £2,905 (2009: £965)
Total recognised gain before tax:     £61,486 (2009: £250,915 loss)
Shareholder Funds:                    £810,082 (2009: £748,596)
Recognised gain per share:            2.73p (2009: 12.38p loss)
Net Asset Value per share:            36p (2009: 33p)
Number of investments:                40 (2009: 30)


CHAIRMAN'S STATEMENT

I  am  pleased to report the improved results for the year ended 30 September 2010, the Company's  fifth
full year of operation.

The  Company has made a total recognised gain of £61,486 (2009: £250,195 loss) for the full  year  and
net  assets  per share have increased from 32.8p to 35.5p  per share, an  increase of  8.23%  for  the
twelve months, and shareholder funds have increased to £810,082.

Market Review
During the last Quarter of 2009 and the first Quarter of 2010, the FTSE index continued its good  run,
showing  good  growth  and outperforming the AIM indices which showed little  change.  In  the  second
Quarter  of  2010  the FTSE re-trenched with the uncertainty of the election and the  growing  concern
about  the  level  of  sovereign debt in the Eurozone. In the third Quarter of 2010  market  sentiment
improved  strongly  and  all our benchmark indices demonstrated resurgent growth,  with  the  two  AIM
indices showing particularly strong growth. By the end of our financial year our benchmark indices had
performed as follows:

FTSE 100 index           +  8.08%
AIM UK 50 Index          + 18.45%
AIM All-share Index      +  21.05%

The  equity and debt funding market for small and micro cap businesses remained challenging, with  the
result  that  only  those  companies with compelling propositions  were  able  to  raise  money.  With
valuations  recovering  but still low, IPO and Trade sales remained unattractive  and  the  main  exit
routes  for  investments remained thin. At the same time the economy still provided a challenging  and
competitive trading environment for companies.

Investment Performance Review
During the period the Net Asset Value of the Company increased from 33p per share to 36p per share.

Where  an underlying investment has a quoted share price this is used for valuation purposes. Unquoted
investments  are  generally valued using their cost price, unless there has been a  significant  event
that justifies revaluation. The valuations of all our unquoted holdings were reviewed at 31 March 2010
and 30 September 2010 and overall the valuation remained more or less unchanged.

The Company generated a total recognised gain of £61,486 resulting in an increase in NAV per share  of
8%.

The Directors do not recommend paying a dividend.

Share Price Performance
During  the period the Company's share price declined by 43% from 35p to 20p. At the end of the period
the share price of 20p showed a discount of over 45% to the Net Asset Value per share of 36p.

Investment Activity Review
At  the  start of the year, the Company held thirty four investments, one of which traded on the  Main
market, four of which traded on AIM, eight traded on PLUS, and the balancing twenty one were unlisted.

SHPE's  strategy  is to invest relatively short term, at the point in a business's  development  where
there is the greatest possible opportunity for value uplift; this is usually before or around the time
that the business undertakes an IPO. The Company then looks to exit investments subsequent to this and
recycle cash into new investments.

The  Company uses a number of strategies to manage the high risk nature of private equity  and  'small
cap'  companies  and  reduce  the impact of choosing companies that do not  succeed,  or  indeed  fail
completely.  Firstly to diversify risk, we are seeking to increase the number of  investments  in  the
portfolio  to  over forty holdings. Secondly we are targeting investments which have the potential  to
show  returns  in  excess of 30% per annum. With these strategies the Company  aims  to  maximise  its
exposure  to  high  performing investments whose performance will substantially  outweigh  the  losses
incurred on those investments which do not succeed.

Eight  new  investments  and two follow-on investments were made during the year.  A  total  of  three
investments were either partly or wholly divested. One was the partial repayment of a loan as planned,
one  was  a  company which went into administration, and one was the liquidation of  assets  taken  in
repayment of an outstanding loan note. The latter two investments had already been provisioned for and
accordingly did not result in any negative impact on NAV.

Overall  news across the portfolio was positive. Quercus, the publisher of the Stieg Larsson Millenium
trilogy, was our star performer in the quoted portfolio with a £95,000 gain in value over the  period.
We  expect the company to report good profits for this year. In addition to improved performance  from
the quoted portfolio a number of our unquoted investments reported encouraging progress. Eleven of our
investee companies raised new investment during the year and five of these were at valuations equal to
or above previous rounds. An indication of an improved but still difficult funding environment.

During the year only one of our unquoted companies was able to achieve a public quote in their shares.
PetroKamchatka  Resources  became  quoted on the Toronto Venture  Stock  Exchange  in  December  2009.
Unfortunately,  the  oil  exploration  company subsequently  experienced  poor  drilling  results  and
consequently the share price has fallen.

As  I  stated  last year the critical success factors for our future performance are twofold.  Firstly
that  we  do  not  lose too many of our potential stars during the downturn and secondly  that  market
sentiment and valuations for small companies strengthens significantly, resulting in re-vitalised  IPO
and  trade sale markets. The last year was not exceptional in terms of performance but we did not lose
any potential stars and the market sentiment for smaller companies did strengthen.

At the end of the year the Company held forty investments, The top twenty investments in the portfolio
by value are set out in the table following:

 Company                     Date of investment Market             Activity
                                                
 Kromek                      August  2006       Unquoted           Technology    company   developing
                             and July 2007                         Cadmium   Telluride,  a   valuable
                                                                   specialist  industrial   material,
                                                                   for  the Security, Inspection  and
                                                                   Defence markets
 Quercus                     August 2006        PLUS               Publisher,   winner    of    small
                                                                   publisher of the year award
 Cadogan Petroleum           August  2007       LSE                Gas   and  Oil  Explorer  in   the
                             and August 2010                       Ukraine
                                                                   
 Neutrahealth                April 2007         AIM                Manufacturer  and  distributor  of
                                                                   nutraceutical products with a 'buy
                                                                   and build' consolidation strategy.
                                                                   Sold post year end date
 Site Intelligence           August 2005        Unquoted           Web Analytics software
 Relay Station               November 2006      Unquoted           Mass broadcaster of voice and text
                                                                   messages
 Karus Therapeutics          June 2007          Unquoted           Developer  of pharmaceuticals  for
                                                                   treatment of chronic diseases such
                                                                   as cancer and inflammation
 Aortech International       May 2010           AIM                Developer   and   distributor   of
                                                                   biomedical products
 Ascent Resources            June 2010          AIM                Gas exploration and production  in
                                                                   Europe
 Timeweave                   June 2010          AIM                Provider       of       Racecourse
                                                                   broadcasting services
 Angel Mining                June 2008          AIM                Gold,   Zinc   and   Lead   mining
                                                                   explorer      with     exploration
                                                                   properties in Greenland
 Myconostica                 April 2008         Unquoted           Developer   and   distributor   of
                                                                   molecular  diagnostic products  to
                                                                   aid   the   rapid   and   accurate
                                                                   diagnosis   of  life   threatening
                                                                   fungal infections
 Environ Group               December 2009      AIM                Support  services holding company.
                                                                   Loan repaid in full post year  end
                                                                   date.
 Twenty                      June 2005 and      AIM                Marketing services business with a
                             March 2007                            buy and build strategy
 Hartfield Securities        March 2007         PLUS               Investment   vehicle   seeking   a
                                                                   reverse takeover opportunity
 Datum                       May 2005           PLUS               Developer   and   distributor   of
                             Sept 2007                             Enterprise    Content   Management
                                                                   software
 TMO Renewables              March 2007         Unquoted           'Disruptive'  technology  provider
                                                                   to the Biofuel sector
 Rainbow Rewards             Sept 2009          Unquoted           US based, Cash back rewards scheme
 Future Biogas               July 2010          Unquoted           Developer of biogas powerplants
 Endeavor Technologies       July 2010          Unquoted           Application   virtualization   and
                                                                   internet data streaming developer


Of  the forty investments in the portfolio, one is traded on the Main market, eight are traded on AIM,
one  on the Toronto Venture Stock Exchange, six are traded on PLUS, and the balancing twenty four  are
unlisted.

Kromek  and  Quercus are the two largest investments in the portfolio representing around 15%  of  NAV
each. As a result the future performance of these two investments has the potential to have a material
impact  on  the  performance  of the whole portfolio. Recent newsflow from  both  companies  has  been
encouraging. Kromek has reported recently that; it has received European Union regulatory approval and
certification  for its bottle scanner systems for screening in airports; and its $4  million  contract
with  the  US  Defense Threat Reduction Agency is progressing well. More information is  available  at
www.kromek.com. No other single investment apart from Cadogan Petroleum (6%) accounts for more than 4%
of NAV.

Board
There were no Board changes during the year.

Outlook
The  restricted  availability of equity and debt finance coupled with an improving  but  weak  economy
still  provides a challenging trading outlook for small and micro cap companies. Although recent stock
market  performance and economic data has been encouraging, there are still a number of factors  which
could slow down or stall the recovery.

The  difficult  economic period we have been through has been traumatic for  a  large  number  of  our
investments  and the weakest ones have failed. Over the last year we believe that, apart  from  Kromek
and Quercus, the portfolio has become more balanced.

In  conclusion, we still believe we have a number of investments in the portfolio that are capable  of
delivering  above average returns and it is encouraging to report that three of the companies  in  our
portfolio  have  ambitions to IPO during 2011. At the Year End we had £103,000 (approximately  13%  of
NAV)  of  cash. This provides us with the opportunity to keep investing selectively at a time when  we
anticipate the market will continue to present the Company with a number of good value opportunities.

On  the  basis of our current Net Asset Value per share and cash resources, and subject to no  further
material  deterioration in the economic outlook, we believe the Company is reasonably  positioned  for
the future and continue to actively seek good investment proposals.




Jon Pither
CHAIRMAN

PRELIMINARY FINANCIAL RESULTS

The  auditors  have  not  yet completed their audit of the annual results, however  the  auditors  have
reviewed the preliminary financial information set out below.

PROFIT & LOSS ACCOUNT
YEAR ENDED 30 SEPTEMBER 2010

                                                                                  Unaudited            Audited
                                                                Note                   Year               Year
                                                                                      ended              ended
                                                                                    30 Sept            30 Sept
                                                                                       2010               2009
                                                                                          £                  £
                                                                                                              
Turnover                                                                              2,905                965
Administrative expenses                                                            (66,819)           (67,595)
Operating Loss                                                                     (63,914)           (66,630)
Exceptional profit on sale of investments                                            29,541             69,151
Other income                                                                         12,464              2,013
Amounts written off investments                                                       (231)          (300,802)
Loss on ordinary activities before                                                 (22,140)          (296,268)
Taxation                                                                                  -                  -
Loss on ordinary activities after taxation                                         (22,140)          (296,268)
                                                                                                              
                                                                                                              
Basic & diluted loss per share (pence)                           1                  (0.98)p           (14.61)p
                                                                                                              
                                                                                                              
                                                                                                              
                                                                                                              

STATEMENT OF RECOGNISED GAINS AND LOSSES
YEAR ENDED 30 SEPTEMBER 2010
                                                                                  Unaudited            Audited
                                                                                       Year               Year
                                                                                      ended              ended
                                                                                    30 Sept            30 Sept
                                                                                       2010               2009
                                                                                          £                  £
                                                                                                              
Loss for the financial year                                                        (22,140)          (296,268)
                                                                                                              
Unrealised surplus on revaluation of investments                                     83,626             45,353
                                                                                                              
Total recognised gains/(losses) relating to the year                                 61,486          (250,915)
                                                                                                              
Basic & diluted recognised gains/(loss) per share (pence)        1                    2.73p           (12.38)p




BALANCE SHEET
AS AT 30 SEPTEMBER 2010
                                                                                 Unaudited           Audited
                                                                                     As at             As at
                                                                              30 Sept 2010           30 Sept
                                                                                                        2009
                                                                                         £                 £
                                                                                                            
Fixed Assets                                                                                                
Investments                                                                        712,959           633,731
                                                                                                            
Current Assets                                                                                              
Debtors                                                                              8,914            10,147
Cash at bank and in hand                                                           103,689           119,379
                                                                                                            
Creditors: Amounts Falling Due Within One Year                                    (15,480)          (14,661)
                                                                                                            
Net Current Assets                                                                  97,123           114,865
                                                                                                            
Total assets less current liabilities                                              810,082           748,596
                                                                                                            
Capital And Reserves                                                                                        
Called up share capital                                                            135,171           135,171
Share Premium Account                                                            1,190,328         1,190,328
Revaluation Reserve                                                                133,607            62,853
Profit & Loss Account                                                            (649,024)         (639,756)
                                                                                                            
Shareholders' Funds                                                                810,082           748,596


Notes

    1.  The calculation of the basic loss per share and diluted loss per share is based on the loss
        attributable to ordinary shareholders of £22,140 (2009: a loss of £296,268), divided by the weighted
        average number of shares in issue during the year. During the year no options were exercised, there is
        no potential dilution as the fair value is below the issue price.
        
        The  calculation of the basic recognised gain per share and diluted recognised gain  per  share
        is  based on the recognised gain attributable to ordinary shareholders of £61,486 (2009: a loss
        of  £250,915),  divided  by the weighted average number of shares in  issue  during  the  year.
        During the year no options were exercised, there is no potential dilution as the fair value  is
        below the issue price.
        
        The weighted average number of shares used in the calculations are set out below:
        
        

                                                                                       2010               2009
                                                                           Number of shares          Number of
                                                                                                        shares
                                                                                                              
                                                                                  2,252,848          2,027,201



    2.  Full accounts for the Company for the year, which are likely to be signed shortly, will be
        posted to shareholders as soon as is practicable.
        
    3.  This financial statement does not constitute statutory accounts within the meaning of Section
        435 of the Companies Act 2006 (the "Act").

    4.  The Directors have not declared a dividend for the period.

    5.  This statement was approved by the Board of Directors on 17 November 2010.




THE DIRECTORS OF THE ISSUER ACCEPT RESPONSIBILITY FOR THE CONTENTS OF THIS ANNOUNCEMENT

ENQUIRIES:

ST HELEN'S PRIVATE EQUITY PLC          TEL: 020 7628 5582
Hamish Williams

FISHER CORPORATE PLC                   TEL: 020 7388 7000

Contact Information

  • St Helens Private Equity Plc