Octopus Eclipse VCT 3 PLC
Interim Management Statement
29 June 2009
In accordance with Rule 4.3 of the UK Listing Authority's Disclosure
and Transparency rules, Octopus Eclipse VCT 3 plc ("Eclipse 3" or
"Fund") presents an Interim Management Statement for the period 1
March 2009 to 26 June 2009. The statement also includes relevant
financial information between the end of the period and the date of
this statement.
Financial Summary
+-------------------------------------------------------------------+
| | | As at 28 | |
| | As at 31 May | February | As at 31 |
| | 2009 | 2009 | August 2008 |
|---------------------------+--------------+----------+-------------|
| | | | |
|---------------------------+--------------+----------+-------------|
| Net assets (000s) | £19,438 | £19,779 | £23,002 |
|---------------------------+--------------+----------+-------------|
| Net profit/(loss) before | | | |
| tax (000s) | £(2,604) | £(2,640) | £(6,058) |
|---------------------------+--------------+----------+-------------|
| Net asset value per share | | | |
| ("NAV") | 66.8p1 | 67.6p | 78.0p |
|---------------------------+--------------+----------+-------------|
| Cumulative dividends paid | | | |
| since launch | 5.7p | 4.7p | 3.2p |
|---------------------------+--------------+----------+-------------|
| Total return (NAV plus | | | |
| dividends paid) | 72.5p | 72.3p | 81.2p |
+-------------------------------------------------------------------+
Note: 1) The Fund went ex-dividend on 29 May 2009 and thus the 1p per
share dividend has been taken into account here
Investment performance
Since the Half-Yearly report at 28 February 2009, the total return
(being NAV plus dividends paid) has risen 0.2p, from 72.3p to 72.5p.
This shows that the performance of the Fund has seen some much needed
stability in the third quarter of its financial year, both in the
unquoted and quoted portfolios. Indeed the value of the quoted
portfolio has risen £48,000 since the half-year end.
A number of our unquoted portfolio companies are making progress,
most notably CSL Dualcom, Audio Visual Machines, Hydrobolt and
Promotion Space. These are well managed, profitable businesses which
have the management teams and financial strength to take advantage of
the opportunities ahead of them. Additionally in the period, the Fund
benefitted from an earn-out of £65,000, this was due to the ongoing
progress of James Harvard International (a prior year exit).
Although our current portfolio companies undoubtedly still face tough
trading conditions, they are all taking sensible steps and cutting
costs to protect their profit margins. Small follow-on investments
have been made into Bruce Dunlop, T4 Holdings Limited, The History
Press, Lilestone Holdings and SweetCred. However, one of the key
advantages we have over traditional funds is that we have a Board
seat on the majority of our portfolio companies so we can keep a
close eye on trading and are able to take action if we need to.
It's also useful to remember that due to their size, smaller
companies are more sensitive to economic shifts than large companies.
So while their values fall more sharply in a downturn, they tend to
increase further with market recovery.
Qualifying Investment Portfolio - Ten Largest Holdings by Value
Company Carrying value % of equity held
Investment class £'000 by Eclipse 3
History Press
Limited Unquoted 2,001 15.2%
CSL Dualcom Holdings
Limited Unquoted 1,732 11.5%
Promotion Space
Limited Unquoted 1,678 12.3%
Hydrobolt Limited Unquoted 1,396 16.3%
Bruce Dunlop &
Associates Unquoted 1,164 11.7%
Vulcan Services
Limited Unquoted 1,000 24.5%
Tristar Worldwide
Limited Unquoted 1,000 10.0%
SweetCred Holdings
Limited Unquoted 917 7.7%
Audio Visual
Machines Limited Unquoted 711 10.8%
T4 Holdings Limted Unquoted 573 11.1%
Dividends
As referred to in the Fund's recent Half-Yearly report, the interim
dividend of 1 pence per share for the six months ending 28 February
2008 was paid on 25 June 2009, to those shareholders on the register
on 29 May 2009. This was paid from revenue reserves.
A final dividend for the year ended 31 August 2008, of 1.5 pence per
share was paid on 5 January 2009 to shareholders who were on the
register on 5 December 2008. This was paid wholly from capital
reserves.
Investment strategy
The objective of the Company is to invest in a broad range of
AIM-quoted and smaller unquoted UK companies in order to generate
income and capital growth over the long-term. Investments are made
selectively across a range of sectors in companies that have the
potential to grow and enhance their value.
The Company's investment policy has been designed to enable the
Company to comply with the VCT qualifying conditions set out above.
The Directors intend that the long-term disposition of the Company's
assets will be not less than 80% in a portfolio of AIM-quoted and
unquoted investments and up to 20% in cash or near-cash investments,
to provide a reserve of liquidity which will maximise the Company's
flexibility as to the timing of investment acquisitions and follow on
investments, dividend payments and share buy-backs.
Material events and transactions
The Fund's Board is not aware of any other significant event or
transaction which has occurred between the 1 March 2009 and the date
of publication of this statement which would have a material impact
on the financial position of the Fund.
For further information please contact:
Chris Allner - Fund Manager
Octopus Investments Limited - 0800 316 2347
ENDS
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