Seneca Growth Capital VCT Annual Report 2022

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FY2022 Annual Report · Seneca Growth Capital VCT

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Annual Report
and Financial Statements

For the year ended 31 December 2022

Company No: 04221489

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Contents

Financial Headlines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Financial Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 03

Strategic Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 05

Our Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 06

Chair’s Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 09

Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Investment Manager’s Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Business Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Details of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

Directors’ Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

Corporate Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

Statutory Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Audit Committee Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52

Directors’ Remuneration Report and Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

Directors’ Responsibilities Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58

Auditor’s Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Report of the Independent Auditor to the Members of Seneca Growth Capital VCT Plc . . . . 60

Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65

Combined Income Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66

Ordinary Share Income Statement (Non-statutory Analysis) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67

B Share Income Statement (Non-statutory Analysis) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68

Combined Balance Sheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69

Ordinary Share Balance Sheet (Non-statutory Analysis) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70

B Share Balance Sheet (Non-statutory Analysis) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71

Combined Statement of Changes in Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72

Ordinary Shares Statement of Changes in Equity (Non-statutory Analysis) . . . . . . . . . . . . . . . . 73

B Shares Statement of Changes in Equity (Non-statutory Analysis) . . . . . . . . . . . . . . . . . . . . . . 74

Combined Statement of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75

Ordinary Shares Statement of Cash Flows (Non-statutory Analysis) . . . . . . . . . . . . . . . . . . . . . . 76

B Shares Statement of Cash Flows (Non-statutory Analysis) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77

Notes to the Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78

Shareholder Information and Contact Details . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93

Directors and Advisers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95

Notice of Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022S
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Financial
Headlines

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022
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B Shares

£3 .9m

£5 .9m

92 .7p

80 .7p

Amount raised during the year from the issue of B shares

Amount invested during the year into ten new investee companies and one follow-on
investment by the B share pool

B share NAV plus cumulative dividends paid at 31 December 2022 (“Total Return”)

B share NAV at 31 December 2022

3 .0p

Interim dividends paid per B share during year

Ordinary Shares

108 .4p

37 .1p

2 .0p

Ordinary share NAV plus cumulative dividends paid at 31 December 2022 (“Total Return”)

Ordinary share NAV at 31 December 2022

Interim capital dividends paid per Ordinary share during year

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022
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Financial Summary

Year to 31 December 2022

Year to 31 December 2021

Ordinary share
pool

Net assets (£’000s)

3,008

Return on ordinary activities after
tax (£’000s)

Earnings per share (p)

Net asset value per share (p)

0 .2

37 .1

Dividends paid since inception (p)

71 .25

Total return (NAV plus
cumulative dividends paid) (p)

108 .35

B share
pool

15,122

(2,762)

(16 .5)

80 .7

12 .00

92 .70

Ordinary share
pool

3,157

1,029

12 .6

38 .9

69 .25

B share
pool

14,606

1,067

8 .9

100 .1

9 .00

108 .15

109 .10

Financial Calendar

The Company’s financial calendar is as follows:

18 May 2023

July 2023

March 2024

Annual General Meeting will be held at 11 .00 a .m .
at 9 The Parks, Haydock, WA12 0JQ

Half-yearly results to 30 June 2023 published

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

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022
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About Seneca Growth Capital
VCT Plc

Seneca Growth Capital VCT Plc (“the Company”
or “Seneca Growth Capital”) is a Venture Capital
Trust, launched in 2001, which now aims to
generate returns from a diverse portfolio of both
unquoted and AIM/AQSE quoted growth capital
investments . Until 23 August 2018 the Company
was called Hygea vct plc . On 9 May 2018, the
Company launched an offer for subscription for
a new B share class and made an initial allotment
of B shares on 23 August 2018, at which point
the Company’s name was changed to Seneca
Growth Capital VCT and Seneca Partners Limited
(“Seneca”) was appointed as the Company’s
Investment Manager .

Fund Manager (AIFM) . The Company’s Board is
composed of four non-executive directors, three of
whom are independent .

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

The Company continues to manage both share
classes in accordance with its investment policy .

The Company has raised £18 .3 million under the
Company’s B share offers as at 31 December 2022 .
It launched a new offer of B shares on 26 August
2022 to raise, in aggregate, up to £10 million with
an over-allotment facility of up to a further £10
million (before issue costs) (the “Offer”) and had
raised £985k under this Offer by the year end .

The Company’s Investment Manager, Seneca, is
registered as a full-scope UK Alternative Investment

The funds raised from the issue of B shares under
the Offer and any subsequent fund raisings are not
limited to being invested in any specific sector .
Instead, the Company’s B share pool targets well
managed businesses with strong leadership that can
demonstrate established and proven concepts and
which are seeking an injection of growth capital to
support their continued development . The B share
pool made ten new investments and a follow-on
investment during the year, details of which are

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included on pages 14 to 29 . The Company intends to
distribute a proportion of the net profits it receives
from realisations of B share pool investments by
way of special tax-free dividends . This is intended to
provide B share investors with an attractive income
stream whilst also maintaining a relatively stable
Net Asset Value (“NAV”) per B share, subject to the
requirements and best interests of the Company .

The Directors continue to seek to return to Ordinary
shareholders over time the proceeds from any
realisations in the form of dividends or by means of
a return of capital . During the year, the Company
realised a further 9% of its holding in Scancell
Holdings Plc (“Scancell”) which enabled the payment
of a further 2 .0p of dividends per Ordinary share
during the year .

Venture Capital Trusts (VCTs)

VCTs were introduced by the UK Government in
1995 to encourage individuals to invest in UK smaller
companies . The Government achieved this by
offering VCT investors a series of tax benefits .

The Company has been approved as a VCT by HM
Revenue & Customs (HMRC) . In order to maintain

its approval, the Company must comply with certain
requirements on a continuing basis which are
discussed further in the Business Review on pages 34
to 38 . The Company has continued its compliance
with these requirements during the year, and both
share classes in the Company are eligible shares as
defined by section 273 ITA 2007 .

In 2015, a sunset clause for VCT income tax relief was
introduced which meant that income tax relief would
no longer be given to subscriptions made on or after
6 April 2025, unless the legislation was renewed by
HM Treasury . On 23 September 2022, the Government
in the Autumn Statement announced its intention to
extend the legislation, safeguarding venture capital
schemes beyond 2025 . The Company also noted
the announcement by the AIC on 28 February 2023
regarding the intention that the sunset clause will
be removed however, the Budget on 15 March 2023
did not make specific reference to this, and at the
time of writing details of how this will proceed have
not been published by the Government . The new
agreement between the UK and EU known as the
Windsor Framework, published on 27 February 2023,
is considered to remove any potential barriers in the
Government progressing this .

Strategic Report

The Directors are required by the Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2014
to include a Strategic Report to shareholders .

The following sections form part of the Strategic Report:

Our Strategy

Chair’s Statement

Investment Manager’s Report

Business Review

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022
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Our Strategy

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

There has been no change during the year in the way
either share pools’ assets are managed . The Ordinary
share pool does not envisage making any new
investments from the funds in this share pool, apart
from any follow-on investment in existing portfolio
companies where the Board believes this will protect
the Ordinary share pool’s existing investment and/
or improve the overall prospects of a timely exit
from the investee company . The Directors have not
made any new Ordinary share pool investments
during the year but will continue to monitor
portfolio companies for any follow-on investment
opportunities that are suitable should they arise, and
continue to seek to return to Ordinary shareholders
over time, the proceeds from any realisations in the
form of dividends or by means of a return of capital .

The Company’s latest Offer for new B shares opened
on 26 August 2022 seeking to raise up to £10 million,
with an over-allotment facility of up to a further £10
million (before issue costs) . The funds raised from
the issue of B shares will not be limited to being
invested in any specific sector . Instead, in line with
the Company’s investment policy, the Company
is targeting well managed businesses with strong
leadership that can demonstrate established and
proven concepts, and which are seeking an injection
of growth capital to support their continued
development .

The Company fosters a culture of innovation, risk
mitigation and collaboration supported by policies,
practices and behaviours to further our purpose
as an investment company, seeking to provide
growth capital to well managed leading UK SMEs
which share our values, in order to deliver on our
investment strategy and objectives as described
below . The Directors will continually monitor
and assess the investment process and ensure
compliance with both the relevant VCT regulations
for qualifying investments, summarised below, and
the Company’s investment policy, included further
below . These robust internal controls are discussed
in the Business Review on page 38, the Corporate
Governance policy on pages 47 to 50 and within the
Audit Committee Report on pages 52 to 53 .

Qualifying Investments

Compliance with required VCT tax rules and
regulations is considered with all investment
decisions made . The Company is further monitored
on a continual basis by Shoosmiths LLP to ensure
compliance on an ongoing basis . The main criteria to
which the Company must adhere include:

•

At least 80% of investments must be made in
qualifying shares or securities;
At least 70% of qualifying investments must be
invested into ordinary shares with no prohibited
preferential rights (investments made before 6
April 2018, from funds raised before 6 April 2011
are excluded);
At least 30% of funds raised after 31 December
2018 must be invested in qualifying investments
by the anniversary of the end of the accounting
period in which those funds were raised;
• No single investment made can exceed 15% of
the total HMRC company value at the time the
investment is made; and
In respect of VCT shares issued on or after 6
April 2014, VCT status will be withdrawn if a
dividend is paid (or other forms of distribution
or payments are made to investors) from the
capital received by the VCT from that issue
within three years of the end of the accounting
period in which shares were issued to investors .

•

Qualifying investments can only be made in trading
companies which fall within the following limits:

• Have fewer than 250 full time equivalent
employees (500 if a knowledge intensive
company);

• Have no more than £15 million of gross assets

•

at the time of investment and no more than £16
million immediately post investment;
Its first commercial sale must be less than seven
years old (or ten years if a knowledge intensive
company) if raising State Aided funds for the first
time subject to certain exceptions;

• Have raised no more than £5 million of State

Aided funds in the previous 12 months (or £10
million if a knowledge intensive company) and
less than the lifetime limit of £12 million (or £20
million if a knowledge intensive company);
Produce a business plan to show that its funds
are being raised for growth and development;

•

• Not be in financial difficulty;
•
Be an unquoted company or listed on AIM;
• Have a permanent establishment in the United

Kingdom;

• Not be under the control of any other company,

nor control any company which is not a
qualifying subsidiary of the company; and
Are operating a trade which is not an “excluded
activity” .

•

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The Finance Act 2018 introduced a “risk-to-capital”
condition for qualifying investments, designed to
focus investments towards earlier stage, growing
businesses, and away from investments which could
be regarded as lower risk . The Board is satisfied that
the Company’s investment policy is in line with this
“risk-to-capital” condition .

The investment policy, as approved by shareholders
on 19 January 2018, is set out below and includes
the sections titled Investment Policy, Qualifying
Investments, Non-Qualifying Investments, Risk
Management, Borrowing and Changes to the
Investment Policy:

Investment Policy

The Company’s investment objective is to provide
shareholders with an attractive income and capital
return by investing its funds in a portfolio of both
unquoted and AIM/AQSE quoted UK companies
which meet the relevant criteria under the VCT rules .

The Company will target well managed businesses
with strong leadership that can demonstrate
established and proven concepts and which are
seeking an injection of growth capital to support
their continued development .

At least the minimum required percentage of the
Company’s assets will be invested in qualifying
investments as required by the VCT rules, with the
remainder held in cash and money market securities .

Qualifying Investments

Compliance with required rules and regulations is to
be considered with all investment decisions made .
The Company is further monitored on a continual
basis to ensure compliance .

Non-Qualifying Investments

An active approach may be taken to manage any
cash held, both prior to its investment in qualifying
companies and any remaining cash after all
investment qualification targets in the VCT rules have
been satisfied . All cash will be invested in accordance
with VCT rules for non-qualifying investments . Such
non-qualifying investments may include liquid AIFs,
UCITS or other money market funds .

Risk Management

The Directors control the overall risk of the portfolio
by ensuring that the Company has exposure to a
diversified range of unquoted and AIM/AQSE quoted
companies . In order to limit risk in the portfolio that
is derived from any particular investment accounting
for too much of the fund, at the point of investment
or addition to an existing investment no more than
15% of the portfolio by VCT value will be in any
one investment . In addition, investments may also
be made by way of loan stock and/or redeemable
preference shares as well as ordinary shares to
generate income, whilst ensuring compliance with
whatever VCT rules apply at the time .

Key Information Document

The EU PRIIPs regulations came into effect in
January 2018 . The intent of the regulations is to
increase customer protection by improving the
functioning of financial markets and in this instance
through the Key Information Document (“KID”)
which provides shareholders with more information
about the risks, potential returns and charges within
VCTs . Although well intended, there were widespread
concerns about the application of some aspects of
the prescribed methodologies to VCTs . Specifically,
there were concerns that:

1 .

2 .

the risk indicator in the KID (a number on a scale
of 1 to 7, with 1 being “lower risk” and 7 being
“higher risk”) may have understated the level of
risk; and
investment performance scenarios included in
the KID may have indicated future returns for
shareholders that were too optimistic .

In what is one of the first examples of the Financial
Conduct Authority (“FCA”) confirming UK divergence
from EU rules following Brexit, revised requirements
for what information should be included in a KID
were published in March 2022 and these came into
full effect on 31 December 2022 . Amongst other
changes, these revised requirements addressed both
of the concerns highlighted above by:

1 .

2 .

stating that a VCT must have a risk indicator of 6
or 7 (on the same scale of 1 to 7); and
replacing the investment performance scenarios
included with text describing:
a) what the investment risks are and what an

investor could get in return;

b) what could affect an investor’s return

positively; and

c) what could affect an investor’s return

negatively .

As before, the Company is required to publish a KID
and retail investors must be directed to this before
buying shares in the Company . The KID is published
on the Company website www .senecavct .co .uk/
current-offer/ . The KID has been prepared using the
methodology prescribed in the FCA’s guidance .

The Board is aware of the new regulations regarding
the KID and has produced a revised KID in line with
the new Regulations . The Board recommends that
shareholders continue to classify VCTs as a high-risk
investment .

Borrowing

Whilst the Board does not intend that the Company
will borrow funds (other than to manage short term
cash requirements), the Company is entitled to do
so subject to the aggregate principal amount, at the
time of borrowing, not exceeding 25% of the value
of the adjusted capital and reserves of the Company
(being, in summary, the aggregate of the issued share
capital, plus any amount standing to the credit of
the Company’s reserves, deducting any distributions
declared and intangible assets and adjusting for any

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variations to the above since the date of the relevant
balance sheet) . The Company did not borrow any
funds in 2022 .

Changes to the Investment Policy

The Company will not make any material changes to
its investment policy without shareholder approval .

Section 172(1) Statement

The Directors discharge their duties under section
172 of the Companies Act 2006 to act in good faith
and to promote the success of the Company for the
benefit of shareholders as a whole as set out in the
Business Review from page 34 . As an investment
company, Seneca Growth Capital has no employees .
The Directors assessed the impact of the Company’s
activities on other stakeholders, in particular
shareholders and our third-party advisers, as well as
the portfolio of companies .

The Board’s decision-making process incorporates,
as part of the Company’s investment policy
and investment objectives as set out on page 7,
considerations for supporting the Company’s
business relationships with the Investment Manager,
shareholders, advisers and registrar, independent
financial advisers and the impact of the Company’s
operations on the community and the environment,
which by nature of the business, only extends to the
holdings in portfolio companies .

Key stakeholders

Investors

Outside of general meetings, the Company engages
with shareholders through regulatory news service
announcements, interim and annual reports as well
as regular correspondence with shareholders and
their advisers to address any queries that arise .

The Company has also introduced regular
shareholder presentations in addition to the AGM,
in order to engage directly with shareholders . At the
November 2022 Shareholder Update Presentation,
the Board had the opportunity to address five queries
put forward by shareholders, the answers to which
are available on our website at www .senecavct .
co .uk/november-2022-shareholder-update-
presentation/ . It was a great opportunity to engage
directly with shareholders and discuss the current
portfolio, investment process and objectives as well
as the wider investment market . Any shareholder
queries that arise throughout the year are discussed
by the Board and factored into any decision-making
and responses are made available to shareholders as
appropriate . The Board uses a number of measures
to assess the Company’s success in meeting its
strategic objectives with regard to shareholder
interests as detailed in the Key Performance
Indicators on page 36 .

Investment Manager

The Company’s most important business relationship
is with the Investment Manager . There is regular
contact with the Investment Manager, and members
of the Investment Manager’s Growth Capital
investment team attend all of the Company’s Board
meetings . There is also an annual timetable agreed
with the Investment Manager and the Company for
matters related to the annual timetable which are
discussed at each Board Meeting . The Company and
Investment Manager also work together to maintain
efficient operation of the VCT as detailed in the Key
Performance Indicators on page 36 .

Portfolio Companies

The Company holds minority investments in its
portfolio companies and it has appointed the
Investment Manager to manage the B share portfolio,
and responsibility for the management of the
Ordinary share pool investments has been delegated
to those remaining members of the Board of
Directors who served immediately prior to 23 August
2018, namely John Hustler and Richard Roth . While
the Board has little day-to-day involvement with the
B share and Ordinary share portfolio, the Investment
Manager provides updates on the B share portfolio
at least quarterly and John Hustler and Richard Roth
also provide updates on the Ordinary share portfolio
at least quarterly .

There were ten investee company additions to
the B share portfolio and a B share pool follow-
on investment into quoted company Arecor
Therapeutics Plc (“Arecor”) during the year . The
Company achieved one full and three partial exits
in the year - one full and two partial exits from the
B share pool and one partial exit from the Ordinary
share pool, as detailed in the Chair’s Statement
on pages 9 to 12 and the Investment Manager’s
Report on pages 14 to 33 . The Board and Investment
Manager believe that the full realisation of B share
pool quoted company Clean Power Hydrogen Plc
(“CPH2”) and partial realisations from each share
pool, which were all profitable, were in the best
interests of all key stakeholders .

Environment and Community

The Company seeks to ensure that its business is
conducted in a manner that is responsible to the
environment as far as is practicable given the nature
of the business as an investment company . The
management and administration of the Company
is undertaken by the Investment Manager, who
recognises the importance of its environmental
responsibilities, monitors its impact on the environment
and implements policies to reduce any damage that
might be caused by its activities . Initiatives of the
Investment Manager designed to minimise its and
the Company’s impact on the environment include
recycling and reducing energy consumption . More
details of the work that the Investment Manager has
done in this area are set out on page 43 .

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022
Chair’s Statement

I am pleased to present the 2022 Annual Report on
behalf of the Board to shareholders .

Overview

It has been an impressive year of new investments
from the B share pool, with £5,920k deployed into
ten new investee companies and one follow-on
investment in Arecor . Seneca continues to deliver on
its investment strategy aimed at achieving a broadly
even split of both AIM/AQSE quoted investments
and unquoted investments across a diverse spread
of sectors and delivering returns for investors
where possible through realisations . The B share
pool achieved three full and partial exits in the year,
generating £964k in gross proceeds and £235k of
profits . Crucially, we have continued to pay B share
dividends of 3p per annum and have now paid a total
of 12p of B share dividends since 2019 which have
been covered by profits on exits .

It was also encouraging to see the Ordinary share
pool continue to realise profitable returns for
Ordinary shareholders with a further partial exit
of our largest quoted investment, Scancell, which
enabled us to pay a 2p capital dividend to Ordinary
shareholders .

Whilst there was some softening of AIM prices during
2022, we and the Company’s Investment Manager,
Seneca, continue to believe that the benefits
offered by AIM quoted investments, including
access to capital, greater liquidity for harvesting
profits and stronger reporting and governance
requirements, will continue to generate attractive
investment returns for investors over the medium
and longer-term . The reduction in the B share NAV
was largely driven by the AIM quoted investments,
but our relatively high percentage cash holding and
unquoted company portfolio continues to dilute
such impact . Seneca also believe that the Company’s
exposure to the AIM market will better position us to
participate more directly in any market recovery .

The total value of the B share unquoted portfolio
at the financial year end was valued above original
investment cost, with 2022 seeing an uplift in value
of two unquoted holdings . We are pleased with the
progress being made across the B share portfolio
and in particular have been impressed by the
positive trading updates and announcements made
by portfolio companies, including such companies
as Bright Network (UK) Ltd (“Bright Network”) and
quoted company Evgen Pharma plc . Bright Network
is on track to double in size over its current financial
year and has started to expand internationally .

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Evgen Pharma plc announced a string of positive
announcements including a substantial out-licensing
deal with Swiss biotech company Stalicla SA worth
$161 million in milestones and double digit royalties,
with up to $6 million in milestones to be received by
the end of 2023 .

In August 2022, the Company launched its fifth offer
for B shares and has now raised £19 .2 million since
2018 following the recent allotment of £933k of
B shares in April 2023 . I would like to welcome all
new shareholders and thank both existing and new
shareholders for their support . The share offer will
remain open until 18 August 2023 unless it reaches
its total target of £20 million before then .

With 31% of the B share pool’s NAV as at 31
December 2022 represented by cash, we were happy
to see the Company’s B share pool end the year well
placed to take advantage of the growing number
of AIM quoted and private company investment
opportunities being reviewed by Seneca .

I have set out below further detail in relation to the
progress made by each of the Company’s share
classes during the year .

B Share Pool

B Shares - Results

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

•
•

•

Three exits generating £235k of profits;
An unrealised loss totalling £2,015k in the year
as a result of the softening in the AIM market;
Two dividends paid during the year totalling 3 .0p
per B share; and
The Company’s running costs (capped at 3% of
B share NAV) .

The net result of the above was an overall decrease
in the Total Return per B share to 92 .7p as at 31
December 2022 (2021: 109 .1p) .

B Shares - Investment Portfolio Review

In the year, the B share portfolio consisted of twenty-
six companies, sixteen of which are quoted on AIM/
AQSE . The net reduction in value across the sixteen
quoted companies during the year, after accounting
for the profit on those exited, was 20% . This is a
more modest reduction in value when compared
to the FTSE AIM All-Share Total Return index which
decreased by over 30% in the same year .

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022
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Throughout the year, the Company completed ten
new investments, one follow-on investment and was
able to make three full and partial exits from the B
share pool at a weighted average return of 1 .3x on
original investment cost . Further details in relation to
the B share pool’s investment portfolio are included in
the Investment Manager’s Report on pages 18 to 29 .

B Shares – Update and Outlook

B shareholders will be pleased to know the Board
declared an interim B share dividend of 1 .5p per B
share on 7 March 2023 to be paid on 19 May 2023 to
shareholders on the B share register on 5 May 2023,
with an ex-dividend date of 4 May 2023 .

We have previously communicated our ambition
to increase dividends to 5% per annum of the B
share NAV by 2023 . This ambition remains but
of course is dependent on a number of factors
including investment performance and in particular
the performance of the B share pool’s AIM quoted
investments, given that as at 31 December 2022
these represented 36 .8% of the B share NAV .

We are encouraged by the continued progress being
made by the B share pool and Seneca’s continued
work with the investee companies in the B share
portfolio to navigate current market headwinds, the
benefit of which we have seen with the increase
in the carrying values for two of the ten unquoted
investee companies, and; one of these uplifts has
been driven by a material and successful funding
round, while the other has been revalued as a result
of significant revenue growth and a move into
profitability . We remain confident that the portfolio
retains its potential to provide attractive returns for B
shareholders over the medium term .

The Board is also pleased with the progress
that Seneca has made since its appointment as
Investment Manager in 2018 in terms of developing
a diverse portfolio of growth capital investments
and securing a number of exits for the B share pool,
which have combined to enhance the Company’s
presence and reputation in the market .

Following the end of the financial year, we have
raised an additional £933k, issuing 1,233,811
additional B shares on 5 April 2023 . The allotment
was made at the 31 March 2023 unaudited B share
NAV (as announced on 4 April 2023) of 73 .8p per B
share which was 6 .9p (8 .6%) lower than the B share
NAV as at 31 December 2022, predominantly a result
of a reduction in the share prices of some of the B
share pool’s AIM quoted investments since that date .

Seneca expect to increase the funds raised under the
current B share Offer and add new growth capital
investments to the B share portfolio during the
course of 2023 from, inter alia, the investments they
currently have in the later stages of due diligence .

Ordinary Share Pool

Ordinary Shares - Results

The NAV per Ordinary share decreased by 1 .8p from
38 .9p to 37 .1p during the year and this was after the
payment of the dividend per Ordinary share of 2 .0p
on 23 December 2022 .

This decrease was principally driven by the dividend
payment in the year . Excluding the dividend
payment, the NAV per Ordinary share remained
relatively flat, with the reduction in value of the
Ordinary share portfolio’s AIM quoted investment in
Arecor and the write down in the carrying value of
unquoted investments in Insense Limited (“Insense”)
and Fuel 3D Technologies Limited (“Fuel3D”)
offsetting the impact of the increase in the AIM
quoted share price of Scancell during the year .

The quoted bid price of Scancell shares (the Ordinary
share pool’s largest investment) increased from 19 .5p
as at 31 December 2021 to 24 .0p at the year end .
At times during the year the Scancell bid price was
above the year end price of 24 .0p . The Company
was able to sell 1,000,000 shares during the year,
generating £258k of proceeds at a 4 .3x return for
Ordinary shareholders .

As a result of the Scancell realisation, your Board was
very pleased to be able to pay a dividend of 2p per
Ordinary share during the year whilst still maintaining
a relatively stable Ordinary share pool NAV . The
Total Return in relation to the Ordinary shares is now
108 .4p comprising cumulative distributions of 71 .3p
per Ordinary share and a residual NAV per Ordinary
share of 37 .1p as at 31 December 2022 . Ordinary
Shareholders will be pleased to know the Board
declared a further interim Ordinary share capital
dividend of 2p per Ordinary share on 7 March 2023
to be paid on 19 May 2023 to shareholders on the
Ordinary share register on 5 May 2023, with an ex-
dividend date of 4 May 2023 .

On 22 November 2022, OR Productivity Limited
was put into administration; however, this has not
had any impact on the Ordinary share NAV as it
was already held at £nil value in the Ordinary share
portfolio .

As previously reported, the Board remains focused
on identifying exit opportunities for the remainder of
the Ordinary share pool investment portfolio .

Ordinary Shares - Investment Portfolio Review

The remaining Ordinary share portfolio now
comprises two AIM quoted holdings valued at
£2,915k, and five unquoted holdings valued at £59k
as at 31 December 2022 .

Shareholders will note that the AIM quoted holdings
represented 97% of the Ordinary share pool’s NAV
at the year end, with Scancell comprising 80% and
Arecor 17% of the Ordinary share pool NAV . As a
result, the NAV per Ordinary share now fluctuates
largely in line with the movement in the AIM quoted
investments, particularly the Scancell share price .

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022

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Whilst the Scancell share price showed volatility
during 2022, it is not our policy to update the
market following each of these fluctuations unless
there are considered to be abnormal events (e .g .
sale of a significant holding – see below) . Your
Board therefore recommends that shareholders or
prospective shareholders keep both the Scancell
and Arecor share prices under review and consider
their impact on the Ordinary share NAV per share
before taking any action in relation to an existing
or prospective holding in the Company’s Ordinary
shares . Based on the composition of the Ordinary
share pool’s fixed assets as at 31 December 2022, the
NAV per Ordinary share moves by 1 .2p for every 1p
movement in Scancell for reference .

Further details in relation to the Ordinary share pool’s
investment portfolio are included in the Investment
Manager’s Report on pages 30 to 33 .

Ordinary Shares – Update and Outlook

As noted above, the Ordinary share pool’s NAV
fluctuates largely in line with the movement in the
AIM quoted investments and following the year end
there was a reduction Scancell’s share price, offset
by an increase in Arecor’s share price . As at 31 March
2023, shares in Scancell were valued at 15 .5p per
share (31 December 2022: 24p) and shares in Arecor
were valued at 250p per share (31 December 2022:
230p) . As a result, on 4 April 2023 the Company
announced an updated unaudited NAV per Ordinary
share of 28 .4p as at 31 March 2023 .

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

In addition, the Ordinary share portfolio held £409k
in cash as at 31 December 2022 . This cash is available
to make follow-on investments into existing Ordinary
share portfolio companies where the Board believes
this will protect the Ordinary share pool’s existing
investment and/or improve the overall prospects of a
timely exit from an investee company . Despite three of
the Ordinary share pool’s portfolio companies seeking
further funds during the year, we did not consider
further investment from the Ordinary share pool
likely to improve the overall prospects for a timely
realisation from the respective investee company and
therefore no further Ordinary share pool investments
were made in the year . The interim capital dividend
previously referred to will consume £162k of this cash .

Ordinary shareholders will recall that, following the
appointment of Seneca as Investment Manager in
August 2018, the Ordinary share pool did not incur
any running costs until July 2021 . From July 2021,
the Company’s running costs were to be shared
between the Ordinary and B share pool pro-rata to
their respective NAVs subject to a 3% cost cap . In the
current year, the Ordinary share pool’s proportion of
the running costs was £28k .

Fund Raising

During the year the Company has allotted 4,188,693 B
shares raising gross proceeds of £3,874k in the process .

Annual General Meeting

The Company’s AGM will be held at 11:00 a .m . on
Thursday, 18 May 2023 at the Company’s registered
address 9 The Parks, Haydock, WA12 0JQ .

For any shareholders wishing to attend the AGM this
year in person, we request that you please inform
us in advance by e-mailing enquiries@senecavct .
co .uk so that we may register your attendance with
the facilities manager in order to issue you with the
appropriate attendance pass . For those unable to
attend, we will be hosting our bi-annual shareholder
update presentation with a question and answer
(Q&A) session included, starting at 2:00 p .m . on
10 May 2023 . Shareholders should note that only
the formal business set out in the notice of AGM
will be considered at the AGM and we encourage
shareholders to attend the presentation and ask
questions prior to the AGM . Further details about
the shareholder update presentation can be found
on the Company’s website at www .senecavct .co .uk/
may-2023-shareholder-presentation/ .

We strongly encourage shareholders to vote on
the matters of business through the completion
of a proxy form, which can be submitted to the
Company’s Registrar . Proxy forms should be
completed and returned in accordance with the
instructions thereon and the latest time for the
receipt of proxy forms is 11:00 a .m . on 16 May 2023 .
Proxy votes can also be submitted by CREST where
shares are so held .

The Board has reviewed my performance and
has asked me to continue as Chair . A resolution
for my re-election is included in the AGM Notice .
Consideration has been given to my long tenure as
Chair and the Board has commenced the process of
identifying my potential successor but has asked that
I continue as Chair until such time as my successor
has been appointed . We are in advanced stages in
the search for another independent non-executive
Director and expect to make the appointment within
the coming weeks . Alex Clarkson and Richard Manley
have indicated that they are willing to continue as
non-executive directors and resolutions for their re-
appointment are included in the AGM notice .

Due to personal and increased business
commitments, Richard Roth has informed the Board
that he will retire as an independent non-executive
Director of the Company at the forthcoming AGM
with effect from 18 May 2023 . I would like to thank
Richard for his considerable contribution to the VCT
over the last eight years and I wish him well in his
other ventures . Richard Roth’s successor as Audit
Chair will be announced in due course .

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022
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As shareholders will recall Richard and I comprise
the CAC and, following his retirement from the
Board, we are reviewing the future of the CAC’s
responsibilities; however, for the time being, I have
asked Richard to continue to be a member of the
CAC for a period of three months following his
retirement and he has agreed .

The Notice of the AGM includes resolutions
empowering the Directors to issue further B shares
following the date of the AGM, which will primarily
be used for the issue of B shares under a further
Offer which we intend to launch for the 2023/2024
tax year . This requires authorisation for the Directors
to be able to allot up to a further 35,000,000 B
shares . Including these resolutions in the AGM
business will avoid the Company having to convene
a separate general meeting to approve the necessary
increase in share capital .

The Notice of AGM also includes a special resolution
authorising the amounts standing to the credit of
the share premium account of the Company and
the capital redemption reserve of the Company be
cancelled, which, if approved by the Company’s
shareholders and subject to subsequent confirmation
by the Court, may be used by the Company to deliver
returns to shareholders in the future, whether in the
form of dividends, distributions or purchases of the
Company’s own shares .

A summary of the resolutions to be proposed by the
Company at the AGM is included on pages 45 to 46 .

VCT Qualifying Status

Shoosmiths LLP provides the Board with advice
on the ongoing compliance with HMRC rules and
regulations concerning VCTs . They have confirmed
that the Company remains within all the appropriate
VCT qualifying regulations as at 31 December 2022 .

Fund Administration

Our administration is conducted by Seneca at the
Company’s registered address . Neville Registrars
Limited (“Neville”) continue to maintain the
shareholder register . All information in respect
of both share classes including Annual Reports
and notices of meetings can be found on our
website www .senecavct .co .uk . We would remind
shareholders who have not opted for electronic
communications that this is more efficient, cost
effective and ecologically friendly than receiving
paper copies by post and we therefore encourage
you to contact Neville, whose details are on page 95,
to advise them of your wish to switch to electronic
communication .

Auditor

As previously announced, Hazlewoods LLP (“HZW”)
was appointed as the Company’s new independent
auditor on 23 May 2022 and has audited the
Company’s annual results for the year ending 31
December 2022 . Shareholders will be asked to
reappoint HZW at the AGM for the audit of the
accounts for the year ending 31 December 2023 .

Future Prospects

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

We are pleased that Seneca have continued to
develop the portfolio of B share pool investee
companies during the year, having completed ten
new investments in the year, the most investments
in a single year since launching the B share pool
in 2018, bringing the total number of investee
companies in the portfolio to twenty-five as at
31 December 2022 . Seneca have also completed
a total of eight full and partial exits since 2019
and have over £4 .6 million of cash on the B share
pool balance sheet at 31 December 2022 . As a
result, Seneca believes that it is very well placed to
continue to support the existing B share investment
portfolio as well as adding attractive new growth
capital investments to the B share portfolio from
the strong pipeline of opportunities presented to
them . We therefore look forward to the continued
development of the B share portfolio .

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

John Hustler
Chair
20 April 2023

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022
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Investment Manager’s Report

We have set out in this section further details in relation to the development of both the B and Ordinary share
pools and their respective investee companies during 2022 .

The B Share Pool

Performance and Dividends

We are pleased with the development of the B share portfolio, having completed more investments in 2022
than in any previous year since launching the B share pool with ten new investments and one follow-on
investment . We continue to deliver on our investment strategy of providing a diverse spread of investments for B
shareholders across both AIM/AQSE quoted companies and unquoted companies and believe that this remains
the most effective strategy to deliver our target returns .

Whilst there has been some softening in AIM prices in the year contributing to the decrease in NAV Total Return
per B share to 92 .7p as at 31 December 2022 (2021: 109 .1p), the benefits offered by AIM quoted investments,
including access to capital markets, improved liquidity, stronger reporting and governance requirements as well
as the ability to participate more directly in any market recovery, mean AIM remains a core part of the B Share
portfolio and deployment strategy .

The negative revenue return of 1 .4p per B share for the year is principally a result of the impact of the Company’s
running costs on the B share pool; however, shareholders will recall that the Company’s total running expenses
are capped at 3% of the B share NAV . As a result, Seneca reduced its annual management fee for 2022 from
£303k to £285k to ensure the Company’s annual running expenses stayed within this 3% limit .

The negative capital return of 15 .1p per B share for the year was principally due to the decrease in the value of
the B share pool’s AIM holdings, partially offset by the profitable exits made in the year which generated £235k
of profits .

Bright Network, the talent attraction and recruitment business focussed on the graduate sector, continued
its impressive development and returned record trading results for the year to March 2022 with turnover and
profits materially up on the prior year . As a result we increased the fair value of Bright Network from £281k
to £457k as at 31 December 2022 . The second uplift in the unquoted B share portfolio was driven by the
completion of a material and successful funding round by Fabacus Holdings Limited (“Fabacus”) at an increased
valuation . As a result, Fabacus was revalued to £702k from £563k . Another unquoted portfolio company,
SolasCure Limited (“SolasCure”), reached a significant milestone in the year with the commencement of their
first in-human clinical trial although its valuation remained unchanged in the year .

Silkfred Limited, an online marketplace for independent ladies’ fashion brands, completed a funding round at
a reduced valuation due to a softening in investor appetite to invest in companies with retail exposure . As a
result, we reduced the fair value of our investment by 50% from £500k to £250k in line with the price of the last
fundraise .

The two B share dividends paid during the year were in line with the Company’s target for 2022 at 3p per year
and it should be noted that the profits realised through the eight full and partial B share portfolio exits to date
exceeds the total value of dividends paid . Furthermore, the Company has sufficient distributable reserves to
enable the continued declaration of B share dividends over the medium term subject to Board approval, the B
share pool investment pipeline and liquidity levels .

Investee Company Updates

We are excited about the progress being made by B share investee companies with the vast majority having
reported positive trading figures and results despite the challenging economic conditions and volatility in the
AIM market in 2022 . As noted above and in the Chair’s statement, we are delighted to have increased the B share
portfolio by ten new investee companies and uplifted two unquoted portfolio valuations as a result of their
continued progress and success .

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022S
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Investments into new companies in the year:

Company

Description

Amount invested

Clean Power Hydrogen Plc – Manufacturer in the Hydrogen
power generation sector .

£500k

Verici Dx Plc – Developer and manufacturer of tests to
understand how a patient will and is responding to organ
transplant, with an initial focus on kidney transplants .

Celadon Pharma Plc – UK-based pharmaceutical company
that has obtained a Schedule 1 Controlled Drugs licence from
the UK Home Office, focusing on growing indoor hydroponic,
high-quality cannabis initially for the chronic pain market .

ProBiotix Health Plc – A company established by OptiBiotix
Health Plc, a B share pool existing investment, to develop
probiotics to tackle cardiovascular disease and other lifestyle
conditions which are affecting growing numbers of people
across the world .

Alderley Lighthouse Labs – A northwest based full-service
diagnostic business spun out from the UK Lighthouse Lab
Network - the largest diagnostic network in British history .

Oxford BioDynamics Plc – A global biotechnology company,
advancing personalised healthcare by developing and
commercialising precision medicine tests for life-changing
diseases .

£280k

£530k

£777k

£500k

£700k

Bidstack Group plc – An advertising technology company
which provides dynamic, targeted and automated native in-
game advertising for the global video games industry across
multiple platforms .

£1,125k

Northcoders Group plc – A northwest based market leading
provider of coding and software development training for
businesses and individuals .

Geomiq Ltd – Developer of the digital manufacturing platform
of choice for 1200+ professional engineers and procurement
teams from over 500 fast-moving hardware companies, and
has partnered with over 220 suppliers on an international basis .

Convenient Collect Ltd (t/a Hubbox) – Software for retailers
including global brands as Macy's, GAP, UGG, Hobbs, Charlotte
Tilbury, and Belstaff to offer local pickup options at checkout
for customers who want alternatives to home delivery .

£300k

£334k

£716k

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022

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It has been our priority to ensure that we are investing in businesses that are well funded with sufficient cash
runway to ensure they are in the best possible position to avoid having to seek further funding in the first 12-18
months, particularly under current market conditions . As a result, we are pleased to report that the £6 million
deployed in the year formed part of a combined total fundraise of £87 million across all eleven investments
(being the ten noted in the table above plus a follow on investment into Arecor) . This is indicative of the size
and type of companies we like to invest in and the degree of growth capital we think is important to deploy to
sufficiently fund these businesses . We are excited about the potential that lies within the B share investment
portfolio and have included updates in relation to the top ten investments by value in the B share pool investee
companies later in this Investment Manager’s Report .

AIM Quoted Investments

We were encouraged that during the year we continued to see a high volume of AIM investment opportunities
and whilst the softening of the market has led to some unrealised losses in relation to the AIM investments made
by the B share pool, it has also meant we were able to deploy funds at more attractive values . This resulted in
seven new AIM investments being added to the B share portfolio and one follow-on AIM investment in portfolio
company Arecor to support the business as it completed the strategic acquisition of Tetris Pharma .

The AIM market continued to provide opportunities to both invest and de-risk existing holdings yielding
attractive returns for investors . As such we took the opportunity to fully realise our investment in Clean Power
Hydrogen Plc (“CPH2”) and to partially realise our holdings in SkinBioTherapeutics Plc (“SkinBio”) and Bidstack
Group plc (“Bidstack”) .

In early 2022, the Company was able to realise a profitable exit for its holding in CPH2 providing a return of 1 .3x
on original investment cost .

The Company was also able to sell 125,000 shares in SkinBio, which represented 2 .7% of the original holding of
4,677,107 shares, reducing the remaining holding to 1,857,107 shares . These were sold at a share price of 51 .5p
per share providing a return of 3 .2x on original investment cost .

Following our investment in Bidstack, we assessed our holdings post-IPO and in line with our AIM strategy
of harvesting early profits where possible we took advantage of a brief increase in share price to realise a
proportion of our shares at a profit and to de-risk our holding as both company specific and macro trends
evolved . Throughout November and December 2022, we sold 7,350,000 Bidstack shares at a 1 .1x return .

Co-investing With Seneca EIS Funds

More generally we continue to develop Seneca’s position in the market as an active growth capital investor and
up to 31 December 2022, Seneca has raised and deployed more than £140 million of EIS and VCT capital into
over 65 SME companies, through over 130 funding rounds, since we undertook our first EIS investment in 2012 .
This includes £12 million raised and deployed to date by the B share pool, a significant proportion of which has
been co-invested with Seneca EIS funds . Seneca has recently made its 30th exit from its EIS funds and has now
returned more than £70m of exit proceeds to investors .

The twenty-five investments in the B share portfolio had a value of £10,602k as at 31 December 2022 and all
but four are co-investments with EIS funds also managed by Seneca . We believe that the opportunity for the
Company’s B share pool to co-invest with EIS funds that are also managed by Seneca provides the B share pool
with a number of advantages including being able to participate in a higher number of investments, of a larger
scale, into more established businesses than would be possible for the B share pool on a standalone basis .

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

Fundraising

Our fourth B share offer concluded in August 2022, bringing total funds raised to £17,335k . Our fundraising
efforts have since continued under our fifth B share Offer, with a further £985k being raised under this Offer as
at 31 December 2022 . We are encouraged by the funds raised and remain focused on increasing the size of the B
share pool, which will in turn allow us to increase the number and diversity of new investments that we make .

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022
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Post year end events and outlook

Following the financial year end reporting period, quoted portfolio company Bidstack announced on 3 January
2023 that they received notification that their largest customer and reseller had served notice that they wanted
to withdraw from a major contract with Bidstack . As a result, Bidstack’s share price fell by c .30%, closing at 1 .95p
on 3 January 2023, down from the 2 .75p closing bid price as at 31 December 2022 .

Further, on 9 January 2023 Poolbeg Pharma Plc (“Poolbeg”) announced positive initial data analysis from the
successful completion of a POLB 001 trial to address the significant unmet medical need to treat a common
inflammatory response to severe influenza . The Poolbeg share price increased by 50% in the days following
the announcement from 5 .9p as at 31 December 2022 to 8 .9p per share at close of trading on the day of the
announcement . The full data read-out is expected in Q2 2023 following a final quality check of the unblinded
data .

The net impact on the B share NAV as a result of these two changes in share price was not material to the B
share NAV .

We also note the successful exit of B share portfolio unquoted investee company Qudini Ltd (“Qudini”) in
January 2023 . This was the result of the sale of the company to US software business Verint Systems, a leader
in workforce engagement management . The consideration comprised an upfront payment equal to the B share
pool’s initial investment and the potential to receive up to a further 0 .44x of the initial investment subject to
Qudini’s trading performance in the three years following the sale . The upfront payment has further bolstered
the liquidity of the B share pool to enable the continued development of the portfolio .

On 21 February 2023, Ten80 Group Ltd . was put into liquidation; however, this has not had any impact on the B
share NAV as it was already held at £nil value in the B share portfolio .

On 6 March 2023, we completed an investment of £376k into AIM quoted Engage XR Holdings Plc (“Engage
XR”) . Engage XR is a professional Metaverse platform used by large fortune 500 companies looking for an
immersive way to engage employees in remote events, training/ development and collaboration . The company
raised €9 .9 million (before expenses) which provides them with a robust cash runway through to 2025 when the
company expects to hit profitability .

The Company also declared an interim B share dividend of 1 .5p per B share on 7 March 2023 to be paid on 19
May 2023 .

The Company raised an additional £933k following the financial year end and issued 1,233,811 additional B
shares on 5 April 2023 at the 31 March 2023 unaudited B share NAV (as announced on 4 April 2023) of 73 .8p per
B share . Due to a softening in the bid prices of some of the B share pool’s AIM/AQSE quoted investments since
the financial year end, the B share pool’s unaudited NAV per B share reduced by 6 .9p to 73 .8p (31 December
2022: 80 .7p) .

The B share pool also completed a follow-on investment of £500k into Old Street Labs Limited (t/a “Vizibl”) in
April 2023 .

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

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022S
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Investment Portfolio –
B Shares

Unquoted Investments

Equity
held
%

Investment at
cost
£’000

Unrealised
profit/(loss)
£’000

Carrying
value at
31 December
2022
£’000

Movement
in the year to
31 December
2022
£’000

SolasCure Limited

Convenient Collect Ltd

Fabacus Limited

Alderley Lighthouse Labs

Old Street Labs Ltd

Qudini Ltd

Bright Network Ltd

Geomiq Ltd

Silkfred Limited

Ten80 Group Ltd

2 .5

5 .8

1 .8

34 .7

3 .5

2 .2

1 .7

1 .1

<1 .0

7 .5

750

716

500

235

334

500

400

Total unquoted investments

4,935

333

202

222

(250)

(400)

107

1083

716

702

500

457

334

250

5,042

139

176

(250)

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022S
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Quoted Investments

Shares
held

Investment at
cost
£’000

Unrealised
profit/(loss)
£’000

Carrying
value at
31 December
2022
£’000

Movement
in the year to
31 December
2022
£’000

Polarean Imaging plc

1,644,070

Bidstack Group plc

32,123,391

ProBiotix Health Plc

3,722,4451

Arecor Therapeutics plc

252,947

Oxford Biodynamics Plc

3,500,000

Poolbeg Pharma plc

7,550,000

Northcoders Group plc

100,000

SkinBioTherapeutics plc

1,857,107

Aptamer Group plc

495,726

Evgen Pharma plc

5,000,000

Celadon Pharmaceuticals plc

320,956

Gelion plc

Verici DX plc

OptiBiotix plc2

Abingdon Health plc

250,492

799,865

350,000

78,250

986

916

777

620

700

755

300

297

580

400

530

363

280

103

(82)

(32)

(70)

(38)

(130)

(310)

(19)

(332)

(180)

(369)

(240)

(192)

(57)

(71)

904

884

707

582

570

445

300

278

248

220

161

123

(32)

(71)

(309)

(130)

(234)

(483)

(406)

(30)

(369)

(228)

(192)

(72)

(20)

Total quoted investments

7,682

(2,122)

5,560

(2,576)

Total investments

12,617

(2,015)

10,602

(2,511)

1 Includes 194,135 shares received as a dividend in specie on 31 March 2022 (“Dividend Shares”) as a result of the spin out
and listing on AQSE of the ProBiotix Health Plc (“Probiotix”) division of B share pool investee company OptiBiotix Health
Plc (“OptiBio”) as a standalone entity in addition to the 3,528,310 shares purchased by the B share pool as part of the same
transaction. These Dividend Shares were received as a result of the B share pool’s shareholding in OptiBio at the point of
the ProBiotix IPO.

2 The cost of the B share pool’s remaining holding in OptiBio at the point of the ProBiotix IPO has been split between
the Dividend Shares and the remaining OptiBio shares pro-rata to their respective values on 31 March 2022. As a result,
the £140k original investment cost of the B share pool’s remaining holding in OptiBio, has been reduced by the amount
allocated to the Dividend Shares of £37k.

Exits for the Year

SkinBioTherapeutics plc*

Clean Power Hydrogen Plc

Bidstack Group plc*

Total

*Partial exit

Investment
Date

February
2019

February
2022

October
2022

No . of
Shares
sold

Investment
at cost
£’000

Sale
Proceeds
£’000

Realised
profit/(loss)
£’000

Exit Multiple

125,000

1,111,111

7,350,000

500

209

729

672

228

964

172

235

3 .1

1 .3

1 .1

1 .3

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B Share Pool –
Investment Portfolio

Listed below are details of the Company’s ten largest B share pool investments
by value as at 31 December 2022 .

Solascure Limited

Initial investment date

January 2021

Cost

£750,000

Valuation

£1 .1 million

Equity type

Unquoted

Equity held

2 .5%

Last statutory accounts

30 June 2022

Turnover

Not Disclosed

Profit/loss before tax

Not Disclosed

Net assets

£5 .9 million

Valuation method

Price of last fundraise

Solascure is an early stage wound care specialist,
originally spun out of and working alongside BRAIN
(world leading German biotech company), to
develop a new-to-market wound care product .

Solscure’s Aurase product is a gel-based product
that efficiently and gently cleans wounds, making
the healing process much more straightforward . Pre-
clinical work has been extremely positive and the
clinical trial is now underway .

Chronic wounds are a growing global problem,
and alternative methods of treatment for hard to
heal wounds are extremely expensive, ineffective,
impractical and slow . Solascure’s proprietary
technology utilises “maggot theory” debridement
without the cost or labour input of live maggots . In
simple terms, it uses maggot enzymes to facilitate
and also promote the body’s own wound cleansing
processes . Core benefits of the product are the clear
practical elements, as well as the reduced time scale
to full debridement without delaying wound healing .

Progress made by the company in 2022 includes:

The enrolment of 45 patients for the phase I clinical
trial across eight sites including 1 in the UK, 2 in
Hungary and 5 in the US (the trial completed in Q1
2023 with results expected to be announced later in
the year) .

Three different national regulators and a host of
other ethics review boards have seen and approved
the protocol and supporting documents for the
phase I clinical trial, with no adverse comments or
rejections .

Commencement of a £1 .3 million funding round to
complete the phase I trial and better position the
business to obtain a strategic partner to enter the
next phase clinical and product development . At the
date of this report, the round was oversubscribed in
excess of £2 .5 million .

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022 Annual Report & Financial Statements for the year ended 31 December 2022

Polarean Imaging Plc

Initial investment date March 2021

Cost

Valuation

Equity type

Equity held

£986,000

£904,000

Quoted

<1 .0%

Last statutory accounts

31 December 2021

Turnover

£1 .2 million

Loss before tax

£14 .0 million

Net assets

£34 .5 million

Valuation method

Bid price of 55p per
share

Polarean Imaging Plc (“Polarean”) is a healthcare
technology company with a proprietary drug-device
combination that provides a visual representation
of ventilation and gas exchange in the lungs . This is
achieved by the patient inhaling polarised Xenon-129
gas (a non-radioactive, noble gas) whilst having
an MRI scan . Polarean technology is effectively an
add-on feature for research and clinical medical
environments using MRI scanners . There are an
estimated 35,000 MRI scanners being used globally .

In March 2021, Polarean raised additional
capital ahead of the final U .S . Food and Drug
Administration’s (“FDA”) approval to position the
business for commercial scale and as part of that
£20m round, with up to £9m VCT/EIS qualifying,
Seneca came in as a cornerstone investor with
just under £1m invested through the VCT and a
further £400k in EIS funds . Seneca had invested
from its EIS funds in March 2020 to provide working
capital support during the period from initial FDA
submission in H2 2020 to anticipated clearance and
through to commercial launch .

Progress made by the company in 2022 includes:

FDA approval for XENOVIEW, the first and only
hyperpolarised MRI contrast agent for novel
visualization of lung ventilation without exposing
patients to any ionizing radiation and its associated
risks for both adolescents and adults representing a
significant market opportunity . Polarean’s commercial
team are now ready to rapidly launch the product for
clinical application and sales .

Net cash of US$16 million as at December 2022,
which based on strategic decisions, could finance
the company into 2024 .

Participation in a research collaboration with Oxford
University Hospitals NHS Trust for long-COVID
and the company’s product was featured in top-
tier academic research publications exploring its
application in Asthma, COPD, cardiopulmonary
disease, endobronchial valve replacement and long-
COVID .

Selection as one of the featured companies
surrounding novel developments in interstitial lung
disease at the 2022 ATS Respiratory Innovation
Summit .

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Bidstack plc

Initial investment date

October 2022

Cost (of the portion of
the original investment
still held as at 31
December 2022)

£916,000

Valuation

£884,000

Equity type

Quoted

Equity held

2 .5%

Last statutory accounts

31 December 2021

Turnover

£2 .6 million

Loss before tax

£7 .9 million

Net assets

£10 .1 million

Valuation method

Bid price of 2 .75p per
share

Bidstack is an advertising technology company which
provides dynamic, targeted and automated native in-
game advertising for the global video games industry
across multiple platforms . Its proprietary technology
is capable of inserting advertisements within video
games . Bidstack’s customers are games publishers
and developers (on the supply side), and advertising
agencies, brands and media-buying platforms (on
the demand side) .

Progress made by the company since initial
investment in October 2022 includes:

Expanding its exclusive native in-game advertising
partnership with a leading, global AAA game
publisher through the addition of two mobile titles .

Signing with global mobile developer Outfit7 for its
portfolio of games which have global reach (up to
470 million monthly active users) .

Securing a partnership with Unity as a “Unity Verified
Solution” . The status has been rigorously tested
and will see the Bidstack software development
kit featured on Unity platforms as a “best in class”
monetisation solution for game developers .

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022 Annual Report & Financial Statements for the year ended 31 December 2022

Convenient Collect Ltd (t/a HubBox)

Initial investment date

December 2022

Cost

Valuation

£716,000

Equity type

Unquoted

Equity held

5 .8%

Last statutory accounts

31 December 2021

Turnover

Not Disclosed

Profit/loss before tax

Not Disclosed

Net assets

£419,000

Valuation method

Cost and price of
recent investment
(reviewed for any fair
value adjustment)

HubBox has developed plug-and-play software
that gives shoppers a choice between home
delivery and local pickup when they check-out on
a retailer’s website . This software has been created
in conjunction with the largest global delivery
network providers (including UPS and DPD) and is
compatible with major ecommerce platforms like
Shopify . Couriers are facing eroding margins on
home deliveries as costs associated with the ‘last
mile’ problem rise, and retailers are suffering from
lost deliveries and failed delivery charges .

HubBox provides ecommerce software that
integrates with both the retailer and the courier,
enabling the retailer to offer shoppers the option
to Click & Collect from the courier’s network of
Pick Up Points . The software turns what would
otherwise be a complex, costly and lengthy piece of
custom development work for retailers into a simple
integration that can be completed in a matter of
hours .

Progress made by the company since initial
investment in December 2022 includes:

Partnering with leading UK courier DPD as their
software partner for DPD Pickup . With 6,500 pickup
locations across the UK, DPD’s network is far
reaching and offers a secure way for shoppers to pick
up their parcels from a chosen location, including
retailers like Sainsbury’s, Post Office and Matalan, as
well as newsagents and pharmacies .

Teaming up with UPS Europe . UPS has an ever-
expanding network of secure-pickup locations
across the world with over 30,000 access points in
European countries alone including Austria, Belgium,
Germany France the Netherlands and Switzerland .

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Annual Report & Financial Statements for the year ended 31 December 2022

ProBiotix Health Plc

Initial investment date

April 2022

Cost

Valuation

£777,000

£707,000

Equity type

Quoted

Equity held

3 .0%

Last statutory accounts

30 June 2022

Turnover

£306,000

Loss before tax

£74,000

Net Assets

£2 .6 million

Valuation method

Bid price of 19p per
share

ProBiotix was formerly a wholly owned subsidiary
of OptiBiotix Health Plc (another of the Company’s
investments) . In March 2022, the company spun
out of OptiBiotix Health Plc, raised £2 .5 million
and listed on the AQSE Growth Market with a
market cap of £26 million . The separate listing
of ProBiotix had been a publicly stated strategic
possibility for some time, following in the footsteps
of SkinBiotherapeutics plc which spun out and listed
in 2017 .

The focus of ProBiotix’s operations is human
microbiome-modulating compounds that tackle
cardiovascular disease and other lifestyle conditions
using the LP-LDL ‘good bacteria’ strain which is
generally recognised to have the ability to reduce
‘bad’ cholesterol in humans by more than a third .

The separate listing of ProBiotix was designed to
accelerate commercial progress, grow direct-to-
consumer product sales and expand into further key
markets like dairy and pharma .

Progress made by the company since April 2022
includes:

Strengthening the management team with the
appointment of new CEO Steen Andersen who
has more than 30 years’ experience in building
businesses in the probiotics industry .

Confirming orders received during the year to the
end of August 2022 (£1 .12 million) exceeding those
invoiced and reported in the full year results for 2021 .
The company is well funded with over £2 million in
the bank at June 2022 that will fund the expansion
of products into new territories, increase direct-to-
consumer sales and develop new technologies .

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Annual Report & Financial Statements for the year ended 31 December 2022

Fabacus Holdings Limited

Initial investment date

February 2019

Cost

Valuation

£500,000

£702,000

Equity type

Unquoted

Equity held

1 .8%

Last statutory accounts

31 August 2021

Turnover

Not Disclosed

Profit/loss before tax

Not Disclosed

Net assets

£10 .5 million

Valuation method

Price of last fundraise

Fabacus is an independent software company that
has developed a complete product lifecycle solution,
Xelacore, aimed at bringing transparency to supply
chain networks, with an initial focus on resolving
the interaction and information flow between global
licensors and their licensees .

Xelacore is a modular, Software as a Service solution
with an intuitive interface and proprietary data
aggregation and management engine that allows
all stakeholders to operate on a single unified
and collaborative platform . It bridges the gaps
in an inefficient process within the current retail
ecosystem by creating authenticated, enriched
universal records that unlock opportunities, reduce
risk and drive performance for both licensors and
licensees .

Progress made by the company in 2022 includes:

Completed a fundraise in conjunction with Wealth
Club, a UK investment service for high net worth
individuals and sophisticated investors, at an
increased valuation of £38 million based on a robust
pipeline and steady revenue growth .

Teamed up with Skydance Animation to launch
global consumer rewards activations through its
licensed products for Apple Original Films, Luck and
Spellbound .

Plans announced to grow revenue to over £100
million by 2027, working alongside the world’s
largest licensees .

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Arecor Therapeutics Plc

Initial investment date May 2021

Cost

Valuation

Equity type

Equity held

£620,000

£582,000

Quoted

<1 .0%

Last statutory accounts

31 December 2021

Turnover

£1 .2 million

Loss before tax

£6 .9 million

Net assets

£18 .5 million

Valuation method

Bid price of 230p per
share

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Arecor raised £20 million in its AIM IPO on 3 June
2021 . Arecor was an existing investee company of
the Ordinary share portfolio and the B share pool
invested £425k in the IPO . The Ordinary share pool
also supported the IPO with a further investment of
£85k .

Arecor is a globally focused biopharmaceutical
company that is aiming to transform patient care by
bringing innovative medicines to market through
the enhancement of existing therapeutic products .
By applying its innovative proprietary formulation
technology platform, Arestat™, Arecor is developing
a portfolio of proprietary products in diabetes
and other indications and is working with leading
pharmaceutical and biotechnology companies to
deliver enhanced reformulations of their therapies .

Arecor’s treatments for people living with chronic
disease are designed to advance patient care and
improve clinical outcomes . Its product portfolio for
diabetes currently includes novel insulin formulations
to deliver an ultra-rapid acting insulin (AT247), and
an ultra-concentrated rapid acting insulin (AT278) .

Progress made by the company in 2022 includes:

The completion of a £6 million placing to support
both the strategic acquisition of global pharma
company Tetris Pharma Ltd and the further
development of the company’s key commercial
diabetes products . The acquisition of Tetris Pharma
provides Arecor with the infrastructure to directly
market selected niche products from its Specialty
Hospital products franchise, which should accelerate
Arecor’s goal of becoming a research-led self-
sustaining pharmaceutical company .

Initiating the phase I US clinical trial for AT247,
an ultra-rapid acting insulin product candidate,
delivered by continuous subcutaneous infusion via
an insulin pump over three days .

Presenting positive phase I clinical data of AT278,
its ultra-rapid acting, ultra-concentrated insulin
product candidate, at leading international diabetes
conference “The International Conference on
Advanced Technologies and Treatments of Diabetes”,
in April 2022 .

Signing an exclusive formulation study collaboration
with a top five global pharmaceutical company .

Securing enhanced IP protection through the grant
of three European patents (two post-period end) and
one US patent .

Launching its Ogluo® product in Germany and
Austria, enabled by an agreement signed with Syneos
Health in December to provide an outsourced
contract sales force .

Transferring AT307 to Hikma Pharmaceuticals plc, a
British multinational pharmaceutical company, which
will now take responsibility for the development of
the AT307 product and seeking FDA approval .

Reporting results in line with market expectations,
including a closing cash balance of £12 .8 million as
at 31 December 2022 .

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Oxford Biodynamics Plc

Initial investment date

October 2022

Cost

Valuation

Equity type

Equity held

£700,000

£570,000

Quoted

2 .0%

Last statutory accounts

30 September 2022

Turnover

£154,000

Loss before tax

£7 .6 million

Net assets

£11 .3 million

Valuation method:

Bid price of 16 .3p per
share

Oxford BioDynamics is a global biotechnology
company, advancing personalized healthcare by
developing and commercializing precision medicine
tests for life-changing diseases .

Its flagship product is EpiSwitch® CiRT (Checkpoint
Inhibitor Response Test) for cancer, a predictive
immune response profile for immuno-oncology
checkpoint inhibitor treatments, launched in
February 2022 .

Oxford BioDynamics has participated in more
than 40 partnerships with big pharma and leading
institutions including Pfizer, EMD Serono, Genentech,
Roche, Biogen, Mayo Clinic, Massachusetts General
Hospital and Mitsubishi Tanabe Pharma .

The company has created a valuable technology
portfolio, including biomarker arrays, molecular
diagnostic tests, bioinformatic tools for 3D genomics
and an expertly curated 3D genome knowledgebase
comprising hundreds of millions of data points from
over 10,000 samples in more than 30 human diseases .

Progress made by the company since initial
investment in October 2022 includes:

Obtaining a unique US reimbursement code for its
EpiSwitch CiRT product; a key milestone for the
company, patients and their doctors . This code
allows the insurance reimbursement under Medicare,
Medicaid and private payers .

Positive initial results reported by Massachusetts
General Hospital from an interim analysis conducted
for the REFINE-ALS biomarker trial . The EpiSwitch
platform was chosen for its ability to prognose
at presentation, from a blood sample, which ALS
patients are likely to have a fast or slow progressing
disease before starting treatment . The results were
encouraging and allowed the medical team to
examine clinically meaningful systematic biomarkers
in the trial .

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Alderley Lighthouse Labs Limited

Initial investment date

October 2022

Cost

Valuation

£500,000

Equity type

Unquoted

Equity held

34 .6%

Last statutory accounts N/A

Turnover

Loss before tax

N/A

Net assets

£363,000

Valuation method

Cost and price of
recent investment
(reviewed for any fair
value adjustment)

Alderley Lighthouse Labs is a next generation UK
diagnostic laboratory, operating from a 3,500 sqft
facility providing first-class office and laboratory
space at Alderley Science Park in the Northwest of
England .

The business incorporates a broad testing repertoire
across blood and molecular testing . It is led by two
founding directors Mark Wigglesworth and Simon
Chapman, with extensive and expert knowledge of
the UK’s diagnostic market, having played a pivotal
role in the rapid deployment of COVID-19 diagnostic
testing in the North of England throughout the
global pandemic .

The UK diagnostics market has been disrupted by
COVID and combined with the economic pressures
on the NHS, is accelerating further change in the
sector and growth in commercial opportunities for
private diagnostics .

Progress made by the company in 2022 includes:

Recruitment of initial team of 11 completed including
5 qualified Biomedical Scientists hand-picked from
the North West’s COVID-19 screening programme
bringing clinical leadership experience, cutting-edge
informatics capability and fulfilling key corporate
accreditation requirements .

Gained all of the necessary accreditations including
UKAS 15189, CQC and successful GCP audit . This a
major milestone in establishing a presence in this
arena, acting as a significant barrier to new entrants
and competing offerings .

Laboratory testing equipment with a replacement
value in excess of £1 .2m commenced operations
providing testing capacity of up to £10m+ per
annum .

Industry leading IT platform which facilitates real
time integration with customer data sets deployed
and enables preferential interaction with new
consumer facing digital organisations .

Establishing a well-advanced pipeline of revenue and
new contract opportunities, including a number of
successful validation studies and projects on behalf
of global commercial partners .

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022 Annual Report & Financial Statements for the year ended 31 December 2022

Old Street Labs Limited (t/a Vizibl)

Initial investment date March 2019

Cost

£500,000 (follow on
investment of a further
£500,000 made in April
2023)

Valuation

£500,000

Equity type

Unquoted

Equity held

3 .5%

Last statutory accounts

31 March 2022

Turnover

Not Disclosed

Profit/loss before tax

Not Disclosed

Net liabilities

£3 .1 million

Valuation method

Revenue multiple

Old St Labs is a provider of cloud based, supplier
collaboration tools for large, blue chip customers,
enabling them to manage key supplier relationships
and strategic project work . The core product, Vizibl,
seeks to make supplier collaboration much more
straight forward, with key focus on compliance,
savings / efficiency and driving growth across the
business .

Vizibl is the only SaaS workspace that supports
collaborative supplier relationships, bringing all
points of contact together in one place, providing
visibility across the company and eliminating
duplication of efforts . Vizibl’s real-time reporting
speeds up decision making, drawing on and sharing
the expertise of the community in the process .
The offering taps into a growing trend in supplier
collaboration, having moved on from the initial focus
on compliance, to an increased emphasis on savings
/ efficiency, and recent developments highlighting
the benefits in terms of wider growth strategy for
large customers .

Progress made by the company in 2022 includes:

Securing new contracts with Santander, British
American Tobacco, Johnson & Johnson and Kraft
Heinz .

Launching the Supplier Sustainability Management
(SSM) module, which has seen the business tap into
significant ESG / sustainability budgets . By 2030, all
large corporates are required to report on the impact
of both their business and their suppliers on the
environment, meaning that reporting, analysis and
improvement tools are trading at a premium . The
Vizibl SSM module is market leading in this space .

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The Ordinary Share Pool

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

Following Richard’s retirement from the Board, the Directors are reviewing the future of the CAC’s
responsibilities; however, for the time being, the Board have asked Richard to continue to be a member of the
CAC for a period of three months following his retirement and he has agreed .

Performance

AIM Quoted Investments

The Ordinary share pool’s largest investment is AIM quoted Scancell, which represented 80% of the Ordinary
share pool’s NAV as at 31 December 2022 . As at the financial year-end, the Scancell share price increased by 23%
from 19 .5p as at 31 December 2021 to 24p at 31 December 2022, predominantly driven by a run of positive news
releases in the final quarter of the year, the highlight being a potential $624 million licensing deal for Scancell’s
proprietary GlyMab® platform . At times during the year the Scancell bid price was above the year end price of
24 .0p . The Company was able to sell a small portion of Scancell shares during the year (1,000,000 shares, 9%,
were sold from a holding at the start of the year of 11,000,000 shares) realising £258k and generating a profit
versus original cost of £198k (a 4 .3x return on the original investment) and a profit versus the 31 December 2021
carrying value of £64k . The Ordinary share pool’s remaining stake in Scancell of 10,000,000 shares increased in
value by £450k during the year to stand at £2,400k as at 31 December 2022 .

As at 31 December 2022, the Ordinary share pool’s investment in Arecor represented 17% of the Ordinary share
pool’s NAV and the quoted bid price of Arecor shares decreased from 370p as at 31 December 2021 to 230p,
softening the year end NAV per Ordinary share .

As noted above, the Ordinary share pool’s NAV fluctuates largely in line with the movement in the AIM quoted
investments and following the year end there was a reduction Scancell’s share price, offset by an increase in
Arecor’s share price . As at 31 March 2023, shares in Scancell were valued at 15 .5p per share (31 December 2022:
24p) and shares in Arecor were valued at 250p per share (31 December 2022: 230p) . As a result, on 4 April 2023
the Company announced an updated unaudited NAV per Ordinary share of 28 .4p as at 31 March 2023 .

However, both Scancell and Arecor have significant commercial opportunities ahead of them and as such we
remain optimistic about the future of these businesses and will continue to monitor their progress .

Unquoted Investments

The Company adjusted the fair value of two Ordinary share pool unquoted investee companies in the year,
resulting in a total Ordinary share unquoted portfolio value of £59k .

Insense informed the Company that its largest shareholder was no longer able to fund the business and as they
had not been successful in raising funds from new or existing shareholders to sustain the business, we reduced
the fair value of the investment from £121k down to £nil .

The Board also made a 50% provision against the fair value of Fuel 3D (£117k as at 31 December 2021) as a result
of slower than expected progress and commercial traction . Therefore, the carrying value of Fuel3D was £59k as
at 31 December 2022 .

On 23 November 2022, OR Productivity Limited was put into administration; however, this has not had any
impact on the Ordinary share NAV as it was already held at £nil value in the Ordinary share portfolio .

Dividends and Outlook

As a result of the above AIM quoted Scancell realisation, the Ordinary share pool was able to pay a dividend of
2p per Ordinary share during the year .

The Total Return in relation to the Ordinary shares is now 108 .4p comprising cumulative distributions of 71 .3p
per Ordinary share and a residual NAV per Ordinary share of 37 .1p as at 31 December 2022 .

As referred to in the Chair’s Statement and announced on 7 March 2023, the Board have declared a further
Ordinary share pool interim capital dividend of 2p per Ordinary share payable on 19 May 2023 .

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As noted in the Chair’s statement, the Company is focussed on realising assets in the Ordinary share pool at the
appropriate time with the proceeds then being distributed to Ordinary shareholders as dividends – it is therefore
noteworthy that realisations in the last five years have enabled the payment of a total of 47p per Ordinary share
in dividends to Ordinary shareholders, representing 73 .6% of the NAV per Ordinary share as at 31 December
2017 . Notwithstanding this success, we remain confident that, overall, there remains the opportunity to realise
further value for Ordinary shareholders in due course (particularly in relation to our AIM holdings) .

Investment Portfolio –
Ordinary Shares

Unquoted Investments

Equity
held
%

Investment at
cost
£’000

Unrealised
profit/(loss)
£’000

Carrying
value at
31 December
2022
£’000

Movement
in the year to
31 December
2022
£’000

Fuel 3D Technologies Limited

<1 .0

Insense Limited

OR Productivity Limited

Microarray Limited

ImmunoBiology Limited

4 .6

3 .7

3 .0

1 .2

299

509

765

132

868

(240)

(509)

(765)

(132)

(868)

(58)

(121)

Total unquoted investments

2,573

(2,514)

(179)

Quoted Investments

Shares
held

Investment at
cost
£’000

Unrealised
profit/(loss)
£’000

Carrying
value at
31 December
2022
£’000

Movement
in the year to
31 December
2022
£’000

Scancell Holdings plc

10,000,000

Arecor Limited

223,977

Total quoted investments

605

227

832

Total investments

3,405

1,795

2,400

288

515

2,083

(431)

2,915

2,974

450

(314)

136

(43)

Exits for the Year

Scancell Holdings plc *

Total

*Partial exit

Investment
Date

No . of
Shares sold

December
2003

1,000,000

Investment
at cost
£’000

Sale
Proceeds
£’000

Realised
profit/(loss)
£’000

Exit
Multiple

258

198

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Ordinary Share Pool –
Investment Portfolio

Listed below are details of the Company’s Ordinary share pool investments as
at 31 December 2022 .

Scancell Holdings plc

Initial investment date

December 2003

In addition, in 2012 a second platform technology,
Moditope, was announced and is based on exploiting
the normal immune response to stressed cells and is
complementary to the ImmunoBody platform . The
AvidMab platform was established in 2018 which
allows direct tumour killing . Scancell continues to
develop its multiple technologies .

£605,000

Progress made by the company in 2022 includes:

Cost (of the portion of
the original investment
still held as at 31
December 2022)

Valuation

£2 .4 million

Equity type

Quoted

Equity held

1 .2%

Last statutory accounts

30 April 2021

Turnover

£nil

Loss before tax

£3 .7 million

Net assets

£18 .1 million

Valuation method

Bid price of 24p per
share

Scancell is an AIM listed biotechnology company
that is developing a pipeline of therapeutic vaccines
to target various types of cancer, with the first target
being melanoma .

The ImmunoBody platform technology educates
the immune system how to respond – this means
that the technology can also be licensed to
pharmaceutical companies to assist the development
of their own therapeutic vaccines, which is an area
of emerging importance for which a number of big
pharmaceutical businesses do not have in-house
technology .

Signing a licensing agreement with Genmab
to develop and commercialise an anti-glycan
mAb, with the company being eligible to receive
milestone payments of up to $208 million for each
product developed and commercialised, up to
a maximum of $624 million if Genmab develops
and commercialises products across all defined
modalities .

The enrolment of fourteen patients, including
dosing in the expansion phase of the monotherapy
arms in the multicentre Phase 1/2 Modi-1 clinical
trial (ModiFY) . First patient dosed in Cohort 3 of
ModiFY in combination with a checkpoint inhibitor
(CPI) . There have been no safety issues to date .

Expansion of SCIB1 Phase 2 combination trial
(SCOPE) protocol to include SCIB1 in combination
with checkpoint double therapy leading to
significantly increased recruitment rate .

In-licensing of the SNAPvax™ technology from
Vaccitech plc to formulate and manufacture Modi-
2, with the aim of initiating a Phase 1 clinical study
in cancer patients during H1 2024 .

Completing the recruitment in COVIDITY Phase
1 clinical trial in South Africa, with safety and
immunogenicity data expected in Q1 2023,
providing read across to our second-generation
ImmunoBody® platform .

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Arecor was admitted to the AIM market on 3 June
2021 and raised £20 million at that point . Arecor was
an existing investee company of the Ordinary share
portfolio and the B share pool invested £425k in the
IPO . The Ordinary share pool also supported the IPO
with a further investment of £85k .

For more information on the company and progress
made in the year, please see page 26, B Share Pool
Investment Portfolio summary .

Arecor Therapeutics Plc

Initial investment date

January 2008

Cost

Valuation

Equity type

Equity held

£227,000

£515,000

Quoted

<1 .0%

Last statutory accounts

31 December 2021

Turnover

£1 .2 million

Loss before tax

£7 million

Net assets

£18 .5 million

Valuation method

Bid price of 230p per
share

Richard Manley
Seneca Partners Limited
20 April 2023

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022Business Review

Company Performance

The Board is responsible for the Company’s investment strategy and performance .

The graphs below compares the NAV return (rebased to 100) of the Company’s Ordinary shares over the period
from launch in October 2001 to December 2022 and the B shares from launch in August 2018 to December
2022, with the total return from a notional investment (rebased to 100) in the FTSE AIM All-Share Index over
the same period . This index is considered to be the most appropriate equity market against which investors can
measure the relative performance of the Company due to average market cap per listing, risk profile and its
investor base being more directly comparable to the Company’s . However, the Directors wish to point out that
VCTs have very restrictive investment criteria in their observance of the VCT rules .

Ordinary Share Performance

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Ordinary Share NAV Total Return*

Ordinary Share NAV Total Return Including Income Tax Reliefs**

FTSE All-Share Index Total Return***

* Ordinary Share Historic NAV total return rebased to 100p at launch
** Ordinary Share Historic NAV total return plus 30% upfront income tax relief rebased to 100p at launch
*** AIM All Share total return basis, rebased to 100

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B Share Performance

B Share NAV Total Return*

B Share NAV Total Return Including Income Tax Reliefs**

FTSE All-Share Index Total Return***

* B Share Historic NAV total return rebased to 100p at launch
** B Share Historic NAV total return plus 30% upfront income tax relief rebased to 100p at launch
*** AIM All Share total return basis, rebased to 100

The NAV Total Return to the investor, is calculated in accordance with AIC Methodology, which includes the NAV
plus dividends paid (rebased to 100p) from launch .

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Results - Return on ordinary activities as per Income Statement

Net return attributable to Ordinary shareholders

Net return attributable to B shareholders

Total

Year ended
31 December 2022
£’000

Year ended
31 December 2021
£’000

(2,762)

(2,749)

1,029

1,067

2,096

Key Performance Indicators (KPIs)

The Board uses a number of measures to assess the Company’s success in meeting its strategic objectives . The
KPIs it monitors include:

KPI

Objective

Total Return (Net Asset Value plus
cumulative dividends paid) per
share for both share classes

We have previously communicated our ambition to increase dividends
to 5% per annum of the B share NAV by 2023 . This ambition remains but
of course is dependent on a number of factors including investment
performance and in particular the performance of the B share pool’s AIM
quoted investments, given that as at 31 December 2022 these represented
36 .8% of the B share NAV .

It also remains our ambition to seek to return to Ordinary shareholders
over time the proceeds from any realisations in the form of dividends or
by means of a return of capital .

The total expenses of the
Company as a proportion of
shareholders’ funds

To maintain efficient operation of the VCT whilst minimising running costs
(noting that Seneca has agreed to cap running costs at 3% of both the
Ordinary and B share NAVs) .

The Total Return for the Ordinary shares and B shares
is included in the Financial Summary on page 3 and
the change in the Total Return is explained in the
Chair’s Statement on pages 9 to 12 . The Total Return
for the B share class decreased during the year by
15% to 92 .7p and the Ordinary share Total Return
increased marginally by 0 .2% to 108 .4p .

The decrease in the B share Total Return in 2022
amounted to 16 .4p which was principally due to the
decrease in the share prices of the B share pool’s
AIM quoted investee companies combined with the
impact of the B share pool’s share of the Company’s
running costs, offset by the uplift in value of two
of the B share pool’s unquoted investments and
the profits generated from three full and partial
realisations of AIM quoted investments during the
year .

The Company has also invested £5,920k into ten new
investee companies and one follow-on investment
during the year from the B share pool and has also
made three B share pool realisations as detailed in
the Chair’s Statement on pages 9 to 12 . The new
investments made are in line with the Company’s
expectations for deploying capital raised and
indicative of the healthy pipeline of growth capital
investment opportunities . The disposals are also

indicative of the potential for harvesting profits from
AIM quoted investments to which the B share pool
has a material exposure .

The increase in the Ordinary share Total Return
amounted to 0 .2p and is principally as a result of
the increase in the share prices of the Ordinary
share pool’s AIM quoted investment Scancell and
the profits generated from the partial realisation of
AIM quoted Scancell shares during the year, offset
by the impact of a reduction in the fair value of two
unquoted investment companies and the allocation
of running costs to the Ordinary share pool, as
detailed in the Investment Manager’s report on page
30 .

We have also made dividend payments for both share
classes .

1 . An interim capital dividend of 2 pence per

Ordinary share for the year to 31 December
2022 was paid on 23 December 2022 .
2 . An interim dividend of 1 .5 pence per B share

for the year to 31 December 2022 was paid on
20 May 2022 . A second interim dividend of 1 .5
pence per B share for the year to 31 December
2022 was paid on 16 December 2022 .

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The Company was again able to maintain efficient
operation of the VCT whilst minimising running costs
as a proportion of shareholder’s funds . For a three-
year period with effect from 1 July 2018, expenses
of the Company were capped at 3% of the weighted
average net asset value of the B shares, including the
management fee (but excluding any performance
fee) . Since July 2021, expenses remain capped at
3% but are now allocated across both the B share
pool and the Ordinary share pool pro rata to their
respective weighted average net asset values . Seneca
reduced its management fee by £18,000 in the year
to 31 December 2022 (2021: reduced by £35,000) to
keep expenses in line with this cap .

Viability Statement

In accordance with provision 30 and 31 of The UK
Corporate Governance Code 2018, the Directors
have assessed the prospects of the Company over
a longer period than the 12 months required by the
“Going Concern” provision . The Board regularly
considers the Company’s strategy, including investor
demand for the Company’s shares, and a three-year
period is considered to be a reasonable time horizon
for this .

The Board has carried out a robust assessment of the
principal risks facing the Company and its current
position, including those which may adversely
impact its business model, future performance,
solvency or liquidity . The principal risks faced by the
Company and the procedures in place to monitor
and mitigate them are set out below .

The Board has also considered the Company’s cash
flow projections and found these to be realistic
and reasonable . The assets of the Company consist
mainly of securities, sixteen of which are AIM quoted,
relatively liquid and readily accessible, as well as
more than £5 million of cash as at 31 December 2022
(28% of net assets) . Since 31 December 2022, two
additional investments have been made totalling
£876k, though the Company’s overall liquidity
remains strong .

Based on the above assessment the Board confirms
that it has a reasonable expectation that the
Company will be able to continue in operation and
meet its liabilities as they fall due over the three-year
period to 31 December 2025 .

Principal risks, risk management and
regulatory environment

The Board carries out a regular review of the risk
environment in which the Company operates,
including principal and emerging risks . The main
areas of risk identified by the Board are as follows:

VCT qualifying status risk: the Company is required
at all times to observe the conditions laid down

in Chapter 3 of Part 6 Income Tax Act 2007 for
the maintenance of approved VCT status . These
rules have subsequently been updated on several
occasions . The loss of such approval could lead to
the Company losing its exemption from corporation
tax on capital gains, to investors being liable to pay
income tax on dividends received from the Company
and, in certain circumstances, to investors being
required to repay the initial income tax relief on their
investment .

The Board keeps the Company’s VCT qualifying
status under regular review . The Board has also
engaged Shoosmiths LLP as VCT status advisor .

Funds raised by VCTs are first included in the
investment tests from the start of the accounting
period containing the third anniversary of the date
on which the funds were raised . The value used in
the qualifying tests is not necessarily the original
investment cost due to the complex rules required
by HMRC, therefore the allocation of Qualifying
Investments as defined by the legislation can be
different to the portfolio weighting as measured by
market value relative to the net assets of the VCT .

The main specific regulations that must have been
met, and which the Directors are confident have
been complied with, are:

•

The Company’s income in the period has been
derived wholly or mainly (70% plus) from shares
or securities .
The Company has not retained more than 15%
of its income from shares and securities .
At least 80% by value of the Company’s
investments has been represented throughout
the period by shares or securities comprised
in qualifying holdings of the investee
company . New funds raised are included in
this requirement from the beginning of the
accounting period in which the third anniversary
of the share issue date falls . By virtue of a
disregard of the impact of disposals which have
been held for more than 12 months (£0 .3m
of proceeds have been realised from such
disposals in the year), as at 31 December 2022
the percentage of shares or securities comprised
in qualifying holdings is 98 .4% in respect of
the 80% Qualifying Holdings test . Note, even
without the disregarding of the impact of
disposals which have been held for more than 12
months as noted above the Company was still
well above the 80% qualifying requirement .
At least 70% by value of the Company’s
qualifying holdings has been represented
throughout the period by holdings of eligible
shares (investments made before 6 April 2018
from funds raised before 6 April 2011 are
excluded) .
At least 30% of funds raised after 31 December
2018 must be invested in qualifying investments
by the anniversary of the accounting period

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in which those funds were raised . As at 31
December 2022, 35% of funds raised in the year
to 31 December 2021 and 34% of the funds
raised in the year to 31 December 2022 had
already been invested in qualifying investments .

• No holding in any company has at any time in

the period represented more than 15% by value
of the Company’s investments at the time of
investment or when the holding is added to .
The Company’s ordinary capital has throughout
the period been listed on a regulated European
market .

•

• No investment made by the VCT has caused the
investee company to receive more than £5m (or
£10m for knowledge intensive companies) of
State Aid investment in the year ended on the
date of the VCT’s investment, nor more than the
lifetime limit of £12m (or £20m for knowledge
intensive companies) . Furthermore, the use of
funds has not been contrary to the EU State Aid
guidelines .

Investment risk: the majority of the Company’s
investments are in smaller quoted and unquoted
companies which are VCT qualifying holdings,
which by their nature entail a higher level of risk
and lower liquidity than investments in large quoted
companies . The Directors and the Investment
Manager aim to limit the risk attached to the
portfolio as a whole by careful selection and timely
realisation of investments, by carrying out due
diligence procedures and by maintaining a spread
of holdings in terms of financing stage . The Board
reviews the investment portfolio on a regular basis .

Financial risk: by its nature, as a VCT, the Company
is exposed to market price risk, credit risk, liquidity
risk, fair value and cash flow risks . All of the
Company’s income and expenditure is denominated
in sterling and hence the Company has no direct
foreign currency risk . The indirect risk results from
investees doing business overseas . The Company is
financed through equity . The Company does not use
derivative financial instruments .

Cash flow risk: the risk that the Company’s available
cash will not be sufficient to meet its financial
obligations is managed by frequent budgeting and
close monitoring of available cash resources .

Liquidity risk: the Company’s investments may be
difficult to realise . The spread between the buying
and selling price of shares may be wide and thus the
price used for the valuation may not be achievable .

Regulatory risk: the Company is required to
comply with the Companies Acts, the rules of the UK
Listing Authority and United Kingdom Accounting
Standards . Breach of any of these might lead to
suspension of the Company’s Stock Exchange listing,
financial penalties or a qualified audit report .

Reputational risk: inadequate or failed controls
might result in breaches of regulation or loss of
shareholder trust .

Internal control risk: the Board reviews annually
the system of internal controls, financial and non-
financial, operated by the Company . These include
controls designed to ensure that the Company’s
assets are safeguarded and that proper accounting
records are maintained .

The Board seeks to mitigate the internal risks by
setting policies, regular review of performance,
enforcement of contractual obligations and
monitoring progress and compliance . In the
mitigation and management of these risks, the
Board applies rigorously the principles detailed in
the Financial Reporting Council’s Guidance on Risk
Management, Internal Controls and Related Financial
and Business Reporting . Details of the Company’s
internal controls are contained in the Corporate
Governance section starting on page 47 .

Further details of the Company’s financial risk
management policies are provided in Note 15 to the
Financial Statements .

Independence, Gender and Diversity

The Board consists of four Directors comprising
three Independent Directors, two of whom were
appointed prior to the appointment of Seneca, with a
further Independent Director appointed in December
2019 . The fourth Director is the CEO of Seneca .
Throughout the year under review, the Board
consisted of four male non-executive directors .
Upcoming regulation applicable from April 2023 will
require a Company to report on a comply or explain
basis against three key indicators: 40% of the Board
should be comprised of women; one senior board
position is to be held by a woman; and one Director
should be from an ethnic minority background .
Whilst not currently complying, the Board will
be mindful in any future recruitment, providing
a suitable candidate possesses the key skills and
experience required for the position The Board will
always appoint the best person for the job . It will
not discriminate on the grounds of gender, race,
ethnicity, religion, sexual orientation, age or physical
ability . The Board also fully supports the aims of
the Hampton Alexander Report and the renewed
focus and emphasis on diversity in the AIC Code
of Corporate Governance (the “2019 AIC Code”)
and in due course will strive to comply with these
recommendations .

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Details of Directors

John Hustler

(Non-Executive Chair)

John joined Peat Marwick, now KPMG, in 1965 and became a Partner in 1983 . Since leaving KPMG in 1993 to
form Hustler Venture Partners Limited, he has advised and been a director of a number of growing companies .
John was appointed to the Board of Octopus Titan VCT plc in November 2007 and served as Chair of the Board
until June 2022 . He was also a member of the Council of The Institute of Chartered Accountants in England and
Wales and Chairman of its Corporate Finance Faculty from 1997-2000, and was a member of the Council of the
British Venture Capital Association from 1989- 1991 . John has been a Director of the Company since inception
and has extensive historic knowledge of the Ordinary share pool investments and the recent development of the
Company’s B share pool . His knowledge remains highly relevant to the ongoing success of the Company .

John has a beneficial interest in Scancell .

Richard Roth

(Non-Executive Director and Chair of the Audit Committee)

Richard is the Chair of Oxford Technology 2 Venture Capital Trust Plc, which has recently merged with the 3
other Oxford Technology Venture Capital Trusts, of which he was (and still is) also a director . He is a Chartered
Management Accountant and worked in the airline industry for a number of companies including easyJet and
the Monarch Group, and was CFO of RoyalJet . He has subsequently had a number of consulting assignments,
in particular helping companies determine their strategy, and implementing business improvements . Richard
has invested in a number of small (mainly unquoted) companies and has also advised several potential start-up
businesses – mainly travel-related . Richard has been a VCT investor for over 20 years and this, combined with
his multiple VCT directorships, provides the Company with valuable and detailed knowledge regarding the
successful ongoing operation of a VCT .

Richard has a beneficial interest in Scancell, Fuel3D and Arecor .

Richard Manley

(Non-Executive Director)

Richard is CEO of and significant shareholder in Seneca . He qualified as a chartered accountant with KPMG
in 2004, joined NM Rothschild’s leveraged finance team in Manchester in 2007 before joining Cenkos Fund
Managers in 2008 . Richard joined Seneca on launch in 2010 . Richard has been involved in the development of all
areas of Seneca’s business and played a key role in its journey from start up to managing more than £100 million .
He has been a continuous member of Seneca’s investment and credit committees and has been involved in all
of Seneca’s EIS growth capital investments to date leading 30 of these . Richard became Managing Partner in
2016 and CEO in 2017 . He joined the Board of the Company in August 2018 . As CEO of the Investment Manager,
Richard is well placed to provide the Company with timely and accurate updates in relation to the development
of the B share portfolio, ongoing fundraise progress, upcoming investments and the continuing administration
of the Company .

Alex Clarkson

(Non-Executive Director)

Alex is Managing Director of Bamburgh Capital . He qualified as a chartered accountant with
PricewaterhouseCoopers in 1998, joined Brewin Dolphin Securities in 2000 before becoming co-founder of
Zeus Capital in 2003 . Alex then went on to co-found Bamburgh Capital in 2011, executing over 20 transactions
acting on both the “buy” and “sell” side and raising funding . During this time, Alex was co-founder of Compass
BioScience Group Limited and Collbio, two highly acquisitive companies, and became interim CFO of Collbio
which undertook an IPO on the London Stock Market within an 18-month period, changing its name to Collagen
Solutions . Given Alex’s experience of public markets and growth capital investing, his expertise and knowledge
are highly relevant to the ongoing success of the Company .

Alex has a beneficial interest in Alderley Lighthouse Labs .

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Directors’ Report

The Directors present their Report and the audited
Financial Statements for the year ended 31
December 2022 .

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

Review of Business Activities

The Directors are required by section 417 of the
Companies Act 2006 to include a Business Review
to shareholders . This is set out on page 34 and
forms part of the Strategic Report . The purpose of
the Business Review is to inform members of the
Company and help them assess how the Directors
have performed their duty under section 172 of the
Companies Act 2006 (duty to promote the success
of the Company) . The Company’s Section 172(1)
Statement on page 8, the Chair’s Statement on page
9 to 12, and the Investment Manager’s Report on
pages 14 to 33 also form part of the Strategic Report .

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

Directors’ Shareholdings – Ordinary
Shares

The Directors of the Company during the year and
their interests (in respect of which transactions are
notifiable under Disclosure and Transparency Rule
3 .1 .2R) in the issued Ordinary shares of 1p are shown
in the table below:

31 December
2022

31 December
2021

Number of
Shares

John Hustler

190,000

Alex Clarkson

Richard Manley

Richard Roth

209,612

All of the Directors’ shares were held beneficially .
There have been no changes in the Directors’
Ordinary share interests between 31 December 2022
and the date of this report .

Directors’ Shareholdings – B Shares

The Directors of the Company during the year and
their interests (in respect of which transactions are
notifiable under Disclosure and Transparency Rule
3 .1 .2R) in the issued B shares of 1p are shown in the
table below:

31 December
2022

31 December
2021

Number of
Shares

John Hustler

31,841

19,735

Richard Roth

15,000

Alex Clarkson

10,060

Richard Manley

96,059

71,846

All of the Directors’ B shares were held beneficially .
There have been no changes in the Directors’ B share
interests between 31 December 2022 and the date of
this report .

Directors’ and Officers’ Liability
Insurance

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

Whistleblowing

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

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Bribery Act

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

Management

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

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

Corporate Governance Statement

The Board has considered the principles and
recommendations of the 2019 AIC Code . The
Company’s Corporate Governance policy is set out
on pages 47 to 50 .

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

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

•

The Company does not have a Chief Executive
Officer or a Senior Independent Director . The
Board does not consider this necessary as it
does not have any executive directors .

•

accurate records in relation to the above as
required under the Alternative Investment Fund
Managers Directive (Directive 2011/61/EU),
transposed into UK law under the European
Union (Withdrawal) Act 2018 and as set out in
Fund 3 .11 of the FCA Handbook of rules and
guidance . As a result, the Directors do not
consider that a formal internal audit function
would be required as an additional internal
control for the VCT at this time .
The Company does not have a Remuneration
Committee as it does not have any executive
directors .
The Company does not have a Nomination
Committee as these matters are dealt with by
the Board .

•

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

Directors

Biographical details of the Directors are shown on
page 40 .

Richard Roth has informed the Board that having
served as a non-executive Director for nearly eight
years, he will retire as an independent non-executive
Director of the Company at the forthcoming AGM
with effect from 18 May 2023 . The appointment of a
new Audit Chair and the recruitment of a new non-
executive Director will be undertaken in due course .

In accordance with the Articles of Association
and good governance in line with practices
recommended in the 2019 AIC Code, following
notification of Richard Roth’s wish to retire, only
three of the four Directors will offer themselves for
re-election at the forthcoming AGM .

The Board is satisfied that, following individual
performance appraisals, the Directors who are
retiring and offer themselves for re-election continue
to be effective and demonstrate commitment to
their roles and have the full support of the Board .
Further details regarding the Company’s succession
planning are set out in the Corporate Governance
policy on pages 47 to 50 .

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

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No concerns about the operation of the Board or the
Company were raised by any Director during the year
and had any been raised they would be mentioned in
the minutes or in writing to the Chair to be circulated
to the Board in accordance with Provision 5 .2 of the
2019 AIC Code .

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

International Financial Reporting
Standards

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

Environmental, Social and
Governance (“ESG”) Practices

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

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

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

The Investment Manager was approved by the FCA
with full-scope UK Alternative Investment Fund
Manager (“AIFM”) permission (as defined in regulation
2 of the AIF Regulations) on 16 June 2022 . This full-
scope UK AIFM permission means that Seneca can
manage assets (including leverage) of greater than
€100 million . Additionally, the Investment Manager
is subject to increased requirements under the AIFM
Regulations 2013 (SI 2013/1773), and therefore
recognises that managing investments on behalf
of clients involves taking into account a wide set of
responsibilities, in addition to seeking to maximise
financial returns for investors . Industry practice in
this area has been evolving rapidly and the Company
seeks to be an active participant by working to
define and strengthen its principles accordingly . This
involves both integrating ESG considerations into the
Investment Manager’s investment decision-making
process as a matter of course, and also considering
guidance issued by external bodies who are leading
influencers in the formation of industry best practice .
The following is an outline of the kinds of ESG
considerations that the Investment Manager is taking
into account as part of its investment process .

Environmental

Seneca, as part of its commercial due diligence
practices and ongoing monitoring, examines
potential issues which could arise from supply
chains, climate change and environmental policy
compliance . The Investment Manager looks for
management teams who are aware of the issues and
are proactive in responding to them . Seneca has also
been certified by Airfriendly Ltd as a Carbon Neutral
Business . Airfriendly Ltd calculate the Investment
Manager’s carbon emissions to the ISO 14064
and GHG Protocol Emissions Standard and then
Airfriendly Ltd invests in or supports projects verified
by five leading Carbon Certification bodies in the
world to neutralise Seneca’s carbon footprint .

The Company utilises video conferencing facilities
for the majority of Board meetings to avoid
unnecessary travel where possible to reduce
our carbon imprint . The Board met virtually for
all but two Board meeting during the year . The
Company also encourages shareholders to receive
communications from the Company electronically
to reduce the impact of production and delivery of
additional paper products .

Social

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

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their boards to discuss material risks, ranging from
business and operational risks to environmental and
social risks .

Seneca is also a proud signatory to the Investing in
Women Code, and commits to adopting internal
practices to improve female entrepreneurs’ access
to finance, tools and resources needed to grow their
businesses . Partners include the UK Business Angels
Association, the British Private Equity and Venture
Capital Association, UK Finance, and the British
Business Bank .

Governance

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

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

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

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

Going Concern

The Company’s business activities and the factors
likely to affect its future performance and financial
position are set out in the Chair’s Statement and
Investment Manager’s Report on pages 9 to 12 and
pages 14 to 33 . Further details on the management
of the principal risks are set out on pages 37 to 38
and financial risks may be found in Note 15 to the
Financial Statements .

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

The assets of the Company consist mainly of
securities, sixteen of which are AIM quoted, relatively
liquid and readily accessible, as well as more than
£5 million of cash as at 31 December 2022 (28% of
net assets) . After reviewing the Company’s forecasts
and expectations, the Directors have a reasonable
expectation that the Company has adequate
resources to continue in operational existence for
the foreseeable future . The Company therefore
continues to adopt the going concern basis in
preparing its Financial Statements .

The Company notes the continuing material market
volatility as a result of macroeconomic pressures
caused by the disruption in global supply chains and
increased costs from inflationary pressures as a result
of the military invasion of Ukraine by Russian forces .
The Company’s Board and Investment Manager are
focused on ensuring that investee companies are
taking the required actions to minimise the potential
impact that these conditions could have on them .
The Board and Seneca will continue to review these
potential risks and keep those risks under regular
review but do not consider the current conditions to
have a material impact on the Company’s own ability
to continue as a going concern .

Share Capital

As disclosed on page 93 the Board has authority to
make market purchases of the Company’s own B
shares . During the year, the Company purchased
27,793 B shares (equal to 0 .16% of the opening
number of B shares in issue) at a price of 90 .4p per
share (2021: nil) .

At the last AGM held on 27 April 2022, the Board
received authority to allot up to 35,000,000 B shares
in connection with any offer(s) for subscription (and
any subsequent top up offer of B shares) and up
to 405,800 Ordinary shares (for any miscellaneous
offers of such shares), which represented
approximately 240% of the Company’s issued B share
capital and approximately 5% of its issued Ordinary
share capital as at 23 March 2022 .

During the year, the Company did not issue any
Ordinary shares (2021: nil) . During the year, the
Company issued 4,188,693 B shares raising £3 .9
million before expenses (2021: 5,525,711 shares and
£5 .7 million) . The Company issued 1,233,811 B shares
on 5 April 2023, raising an additional £933k between
31 December 2022 and the date of this report .

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The Company’s issued Ordinary share capital as at 31
December 2022 was 8,115,376 Ordinary shares of 1p
each (31 December 2021: 8,115,376 Ordinary shares
of 1p each) and 18,749,559 B shares of 1p each (31
December 2021: 14,588,659 B shares of 1p each) .

The total number of shares in issue for both the
Ordinary shares and B shares of 1p each as at
31 December 2022 was 26,864,935 and as at 19
April 2023 was 28,098,746 (31 December 2021:
22,704,035) with each share having one vote .

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

•

The Company’s capital structure and voting
rights are summarised above, and there are no
restrictions on voting rights nor any agreement
between holders of securities that result in
restrictions on the transfer of securities or on
voting rights;
There exist no securities carrying special rights
with regard to the control of the Company;
The rules concerning the appointment and
replacement of directors, amendment of the
Articles of Association and powers to issue or
buy back of the Company’s shares are contained
in the Articles of Association of the Company
and the Companies Act 2006;
The Company does not have an employee share
scheme;
There are no agreements to which the Company
is party that may affect its control following a
takeover bid; and
There are no agreements between the Company
and its Directors providing for compensation
for loss of office that may occur following a
takeover bid or for any other reason, apart
from their normal notice period and any fees
potentially due under the performance fee
arrangements set out on page 56 and Note 5 .

Substantial Shareholdings

At 31 December 2022 and at the date of this
report, there was one holding of 3% and over of
the Company’s ordinary share capital of which we
had been notified . This holding related to Mr and
Mrs Ian William Currie and at the date of this report
amounted to 3 .2% .

Annual General Meeting

The Notice convening the 2023 AGM of the
Company is set out at the end of this document (and
a form of proxy in relation to the meeting is enclosed
separately) . Part of the business of the AGM will be
to consider resolutions in relation to the following
matters:

Resolution 1 will seek the approval of the Directors’
Annual Report and Financial Statements and the
auditors’ report thereon for the year ended 31
December 2022 . The Directors are obliged to lay the
Directors’ Annual Report and Financial Statements
and the auditors’ report thereon for the year ended
31 December 2022 before shareholders at a general
meeting .

Resolution 2 seeks shareholder approval of the
Directors’ Remuneration Report 2022 which gives
details of the Directors’ remuneration for the
financial year ended 31 December 2022 and which
is set out on pages 54 to 57 of the Directors’ Annual
Report and Financial Statements for financial year
ended 31 December 2022 . In line with legislation, this
vote will be advisory and the Directors’ entitlement
to remuneration is not conditional on the resolution
being passed .

Resolutions 3 to 5 will seek the re-election of
John Hustler, Richard Manley and Alex Clarkson as
non-executive Directors of the Company . Richard
Roth has informed the Board that having served as
a non-executive Director for nearly eight years, he
will retire as an independent non-executive Director
of the Company at the forthcoming AGM with effect
from 18 May 2023 . The appointment of a new Audit
Chair and the recruitment of a new non-executive
Director will be undertaken in due course .

Resolution 6 will seek the re-appointment of
Hazlewoods LLP as Independent Auditor to the
Company and authorisation to determine the
auditor’s remuneration .

Resolution 7 will authorise the Directors to allot
further B shares and Ordinary shares . This will enable
the Directors until the next AGM to allot up to
35,000,000 B shares in connection with any offer(s)
for subscription (and any subsequent top up offer of
B shares) and up to 405,800 Ordinary shares (for any
miscellaneous offers of such shares), representing
approximately 175% of the Company’s issued B share
capital and approximately 5% of its issued Ordinary
share capital as at 19 April 2023 .

Resolution 8 will authorise the Board, pursuant to
the Act, to make one or more market purchases of
up to 14 .99% of the issued B share capital of the
Company from time to time . The price paid must not
be less than 1p per B share, nor more than 5% above
the average middle market price of a B share for the
preceding five business days . Any B shares bought
back under this authority may be cancelled by the
Board .

Resolution 9 will, under sections 570 of the Act,
disapply pre-emption rights in respect of any
allotment of the B shares and/or Ordinary shares
authorised under Resolution 8 .

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022

Copies of the Articles of Association of the Company
(including a mark-up of the amended articles of
association proposed to be adopted pursuant to
Resolution 11) will be available for inspection at
the registered office of the Company during usual
business hours on any weekday (Saturday and Public
Holidays excluded) from the date of this notice,
until the end of the Annual General Meeting and
at the place of the Annual General Meeting for at
least 15 minutes prior to and during the meeting .
The Articles of Association will also be available on
the Company’s website at www .senecavct .co .uk/
reports-documents/ .

Recommendation

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

By Order of the Board
ISCA Administration Services Limited
Company Secretary
20 April 2023

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Resolution 10 will authorise the cancellation of
the share premium account and capital redemption
reserves of the Company . One of the main principles
of company law is that the capital of a company
should be maintained . The principle of maintenance
of capital underlies various provisions of the Act – for
example, a company may only make distributions
to its members out of distributable profits and a
company may only buy back its own shares in limited
circumstances .

A company can, however, reduce its share capital in
circumstances where creditors will not be adversely
affected, provided that the company complies with
certain procedural requirements . The Act provides
that a company may reduce its capital by special
resolution, subject to confirmation by the Court . A
special reserve will then be created from the sums
set free from such a cancellation which can be
regarded as a distributable reserve .

The Company has completed previous cancellations
of its share premium and capital redemption reserves
and the special reserve created by such cancellations
has enhanced the ability of the Company to make
distributions and buy back shares .

The Board considers it prudent to take the
opportunity to seek the approval of Shareholders
pursuant to Resolution 10 for the cancellation of the
share premium account and the capital redemption
reserve (subject to the sanction of the Court) .

The sums set free by the proposals above would
create further distributable reserves to fund
distributions to Shareholders and buybacks, to set
off or write off losses and for other distributable and
corporate purposes of the Company . The Board will
seek Court approval of this resolution as and when
required, and will only use such reserves taking into
account the VCT restrictions on returns of capital .

Resolution 11 will seek authority to amend the
Company’s Articles of Association to increase the
maximum aggregate fees paid to Directors from
£100,000 to £150,000 per annum . This was last
amended in 2018 and the increase in now considered
necessary in anticipation of new non-executive
directors joining the Board . Total expenses, however,
remain allocated to each share pool on a pro-rata
basis and capped at 3% of the net asset value of each
respective share pool .

The Directors intend to use the authorities in
Resolutions 7 and 9 for the purposes of the current
Offer and a further offer for subscription of B shares .
The Directors have no current intention to utilise the
authority in relation to the Ordinary shares .

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Corporate Governance

The Board has considered the principles and
recommendations of the 2019 AIC Code .

The 2019 AIC Code addresses the Principles and
Provisions set out in the UK Code, as well as setting
out additional Provisions on issues that are of
specific relevance to the Company .

The Board considers that reporting against the
Principles and Provisions of the 2019 AIC Code,
which has been endorsed by the Financial Reporting
Council (and associated disclosure requirements
under paragraph 9 .8 .6 of the Listing Rules) provides
more relevant information to shareholders .

The Company is committed to maintaining high
standards in corporate governance and has complied
with the Principles and Provisions of the 2019
AIC Code, except as set out below . The Company
strongly believes that achieving its corporate
governance objectives contributes to the long-term
sustainable success of the Company .

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

Board of Directors

The Company has a Board of four non-executive
Directors, details of each can be found on page
40 . They meet on a regular basis to review the
investment performance and monitor compliance
with the investment policy laid down by the Board as
set out in the Strategic Report on page 7 .

The Board has a formal schedule of matters
specifically reserved for its decision which include:

1 .

2 .

the consideration and approval of future
developments or changes to the investment
policy, including risk and asset allocation;
the consideration and review of the Company’s
compliance with HMRC conditions for
maintenance of approved VCT status as advised
by Shoosmiths LLP;

3 . consideration of corporate strategy;
4 . approval of the appropriate dividend to be paid

5 .

6 .

to shareholders;
the appointment, evaluation, removal and
remuneration of the Investment Manager, which
also acts as the Administration Manager;
the performance of the Company, including
monitoring the discount of the share price to
net asset value; and

7 . monitoring shareholder profiles and considering

shareholder communications .

The Chair leads the Board in the determination of
its strategy and in the achievement of its objectives .
The Chair is responsible for organising the business
of the Board, ensuring its effectiveness and setting
its agenda . He facilitates the effective contribution of
the Directors and ensures that they receive accurate,
timely and clear information and that the Company
communicates effectively with shareholders in
accordance with the Board’s duty to promote the
success of the Company .

The Company Secretary is responsible for advising
the Board through the Chair on all governance
matters . All of the Directors have access to the
advice and services of the Company Secretary, who
has administrative responsibility for the meetings
of the Board and its Committees . Directors may
also take independent professional advice at
the Company’s expense where necessary in the
performance of their duties .

The Company’s Articles of Association and the
schedule of matters reserved to the Board for
decision provide that the appointment and removal
of the Company Secretary is a matter for the full
Board .

Attendance at Board and Audit Committee meetings
during the year were as follows:

Board meetings
attended
(13 held in year)

Audit Committee
meetings attended
(2 held in year)

John Hustler

Alex Clarkson

Richard Manley

Richard Roth

In addition to formal Board meetings, the Board
communicates on a regular basis in carrying out its
responsibilities in managing the Company .

Diversity

The Directors are aware of the need to have a
Board which, as a whole, comprises an appropriate
balance of skills, experience and diversity . Upcoming
regulation applicable from April 2023 will require
a Company to report on a comply or explain basis
against three key indicators: 40% of the Board should
be comprised of women; one senior board position
is held by a woman; and one Director should be from
an ethnic minority background . Throughout the year

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and at the date of this report the Board of Directors
comprised of four males all identifying themselves
as Caucasian by ethnic background . Diversity of the
Directors is something the Board will be mindful
of in any future recruitment, providing a suitable
candidate possesses the key skills and experience
required for the position .

Consumer Duty

The Directors, having noted the requirements in
respect of Consumer Duty, have reviewed the
Investment Manager’s implementation plan, which
was in place by 31 October 2022, and are working
with the Investment Manager to ensure that
implementation of the Consumer Duty requirements
is completed by 31 July 2023, when the new
requirements come into effect .

Independence of Directors

The Board regularly reviews the independence of
its members and is satisfied that the Company’s
Directors are independent in character and judgment
and that there are no relationships or circumstances
which could affect their objectivity (with the
exception of Richard Manley who is the CEO of the
Investment Manager) .

The 2019 AIC Code recommends that where a
Director has served for more than nine years, the
Board should state its reasons for believing that
the individual remains independent . The Board is
of the view that a term of service in excess of nine
years is not in itself prejudicial to a Director’s ability
to carry out his or her duties effectively and from
an independent perspective; the nature of the
Company’s business is such that individual Directors’
experience and continuity of Board membership
can significantly enhance the effectiveness of the
Board as a whole . However, the Board has applied
the provision that all Directors are to seek annual
re-election and has determined a policy of tenure
for the Chair and believe that both are essential
in balancing the business of the Company whilst
providing opportunity for regular refreshment and
increasing the diversity of the Board .

Directors are appointed with the expectation that
they will serve for a period of at least three years
and all Directors will retire at the first general
meeting after election and will be subject to
annual re-election thereafter in line with practices
recommended in the 2019 AIC Code . It is the
Company’s policy of tenure to review individual
appointments every year, with increased scrutiny
after nine years of service to consider whether the
Director is still independent and still fulfils the role .
However, in accordance with the principles of the
2019 AIC Code, we do not consider it necessary
to mandatorily replace a Director, including the
Chair, after a predetermined period of tenure . A
more flexible approach to Chair tenure will help
the Company manage succession planning in the
context of the business needs of the Company,
whilst at the same time still addressing the need for
regular refreshment and diversity . The Company’s
report on Independence, Gender and Diversity is on
page 38 .

Given that the Chair has now served as a Director for
more than 20 years, the Board and Chair have had a
number of conversations over the last four years with
regard to his ongoing tenure and the process for
identifying his potential successor . Whilst the Board
has determined that John Hustler, 76, is capable of
carrying out his duties effectively, given the policies
outlined above, plans are now being made for his
succession . In addition, further to Richard Roth’s
announcement that he will retire as an independent
non-executive Director of the Company at the
forthcoming AGM, the Board are also now making
plans to recruit a further new non-executive
Director .

In view of the above, the Board is pleased that we
are already in advanced stages in the search for an
independent non-executive Director and expect to
make the appointment within the coming weeks .

Remuneration in addition to the Directors’ fees in the
form of a performance incentive fee is potentially
payable to those Directors serving prior to 23 August
2018 subject to certain conditions as set out in
the Directors’ Remuneration Report and Policy on
pages 54 to 57 . Having regard for the historic nature
and circumstances under which the performance
incentive fees were agreed, the Board does not
believe that the performance incentive fees in any
way impact or hinder the Directors’ independence
or present a conflict of interest which could
compromise or override independent judgment of
the Directors .

Performance Evaluation

In accordance with the 2019 AIC Code, each year
a formal performance evaluation is undertaken
of the Board as a whole, its Committees and the
Directors in the form of one-to-one meetings or
telephone calls between the Chair and each Director .
The Directors were made aware of the annual
performance evaluation on their appointment .
The Board considers the size of the Company, the
number of independent non-executive Directors
on the Board and the robustness of the reviews
to be such that an external Board evaluation is
unnecessary . Annual evaluations of the Board
consider its composition, diversity, succession
planning and how effectively members work
together to achieve objectives as well as individual
contributions . The Chair provides a summary of
the findings to the Board, which are discussed at
the next meeting and an action plan agreed . The
performance of the Chair is evaluated by the other
Directors . The Board has not appointed a Senior
Independent Director, as it does not believe that
such an appointment is necessary when the Board
is comprised solely of non-executive Directors . As
suggested in the 2019 AIC Code, the duties of this
role can be, and in this instance are, fulfilled by the
Chair of the Audit Committee, Richard Roth .

The Board sets out the assessment of its members
and explains why its members are and continue to be
of importance to the long-term sustainable success
of the business on page 42 .

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The Board reviews the performance of the
Investment Manager on an ongoing basis, both
formally and outside of Board meetings with
regard to its appointment, evaluation, removal
and remuneration, in both contexts of its role as
Investment Manager and Administration Manager .
The Board considers the Company’s size to be
such that it would be unnecessarily burdensome
to establish a separate management engagement
committee to perform this role .

Board Committees

The Board does not have a separate remuneration
committee, as the Company has no employees or
executive directors . Detailed information relating
to the remuneration of Directors is given in the
Directors’ Remuneration Report and Policy on pages
54 to 57 .

The Board as a whole considers the selection and
appointment of Directors and reviews Directors’
remuneration on an annual basis . The Board
considers the Company’s size to be such that it
is unnecessary to form a separate committee for
the purposes of nomination . When making an
appointment, the Board draws on its members’
extensive business experience and range of contacts
in addition to the use of external recruitment
consultants . During the year the Board engaged an
outside recruitment company to assist in finding
a suitable candidate to join as a new independent
non-executive Director . The process involved
the identification of key skills a candidate should
possess which the recruitment agency then used
to assist with the drawing up of a long-list of
possible candidates for the Board, which acting
as a nomination committee, then reduced to a
short-list of candidates who were interviewed . We
are in advanced stages in the search for another
independent non-executive Director and expect to
make the appointment within the coming weeks .
The Board continues to speak regularly about Board
composition and succession planning in order to
identify and address any issues that may arise .

The Board has appointed an Audit Committee to
make recommendations to the Board in line with
its terms of reference . The committee is chaired by
Richard Roth and consists of all four Directors . The
Audit Committee believes Richard Roth possesses
appropriate and relevant financial experience as per
the requirements of the 2019 AIC Code . The Board
considers that the members of the Committee have
collectively the skills and experience required to
discharge their duties effectively .

The Audit Committee’s terms of reference, and how
it discharges its duties are listed on pages 52 to 53 .

Internal Control

The Directors have overall responsibility for keeping
under review the effectiveness of the Company’s
systems of internal controls . The purpose of these
controls is to ensure that proper accounting
records are maintained, the Company’s assets are
safeguarded and the financial information used

within the business and for publication is accurate
and reliable; such a system can only provide
reasonable and not absolute assurance against
material misstatement or loss . The system of internal
controls is designed to manage rather than eliminate
the risk of failure to achieve the business objectives .
The Board continually reviews financial results and
investment performance . The Board also monitors
and evaluates external service providers and
maintains regular discussions with the Investment
Manager about the services provided . The
Investment Manager reviews the service contracts on
an annual basis and discusses any recommendations
with the Board as relevant .

Neville Registrars is the custodian of the documents
of title relating to the Company’s unquoted
investments .

Seneca is also the Administration Manager in addition
to its role as the Investment Manager .

The Directors confirm that they have established a
continuing process throughout the year and up to
the date of this report for identifying, evaluating and
managing the significant potential risks faced by the
Company and have reviewed the effectiveness of
the internal control systems . As part of this process
an annual review of the internal control systems is
carried out in accordance with the FRC’s Guidance
on Risk Management, Internal Control and Related
Financial and Business Reporting .

The risk management and internal control systems
include the production and review of monthly bank
statements and quarterly management accounts .
All outflows made from the Company’s accounts
require the authority of signatories from the Board .
The Company is subject to a full annual audit . Further
to this, the Audit Partner has open access to the
Directors of the Company .

Additionally, the Investment Manager is required to
have a depositary as part of its full-scope AIFM status .
Seneca appointed Thompson Taraz Depositary Limited
who is responsible for monitoring the cash flows of the
Company, overseeing the holding of financial assets in
custody on behalf of the Company, verifying ownership
interests, oversight and supervision of the Investment
Manager and the Company and maintaining accurate
records in relation to the above as required under
the Alternative Investment Fund Managers Directive
(Directive 2011/61/EU), transposed into UK law under
the European Union (Withdrawal) Act 2018 and as set
out in Fund 3 .11 of the FCA Handbook of rules and
guidance .

Financial Risk Management
Objectives and Policies

The Company is exposed to the risks arising from its
operational and investment activities . Further details
can be found in Note 15 to the Financial Statements .

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For the reasons set out in the 2019 AIC Code, and
as explained in the UK Corporate Governance Code,
the Board considers the above provisions are not
relevant to the position of the Company, being an
investment company run by the Board and managed
by the Investment Manager . In particular, all of the
Company’s day-to-day administrative functions are
outsourced to third parties . As a result, the Company
has no executive directors, employees or internal
operations .

By Order of the Board
ISCA Administration Services Limited
Company Secretary
20 April 2023

Relations with Shareholders

Shareholders have the opportunity to meet the
Board at the AGM . In addition, shareholders have
the opportunity to engage directly with the Board as
part of the regular shareholder update presentations
as detailed in the Strategic Report starting on page
5 and the Board is available to answer any questions
a shareholder may have and is happy to respond to
written queries made by shareholders during the
course of the year . The Board can be contacted
at the Company’s registered office: 9 The Parks,
Haydock, WA12 0JQ or via email at enquiries@
senecavct .co .uk .

Compliance Statement

As previously indicated, the Board considers
that reporting against the principles and
recommendations of the 2019 AIC Code will provide
better information to shareholders .

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

•

The Company does not have a Chief Executive
Officer or a Senior Independent Director . The
Board does not consider this necessary as it
does not have any executive directors .

•

• New Directors do not receive a formal induction
on joining the Board, though they do receive
one tailored to them on an individual basis .
The Company conducts a formal review as to
whether there is a need for an internal audit
function . The Investment Manager was required
to appoint a depositary as part of its full-scope
AIFM status who is responsible for monitoring
the cash flows of the Company, overseeing the
holding of financial assets in custody on behalf
of the Company, verifying ownership interests,
oversight and supervision of the Investment
Manager and the Company and maintaining
accurate records in relation to the above as
required under the Alternative Investment Fund
Managers Directive (Directive 2011/61/EU),
transposed into UK law under the European
Union (Withdrawal) Act 2018 and as set out in
Fund 3 .11 of the FCA Handbook of rules and
guidance . As a result, the Directors do not
consider that a formal internal audit function
would be a required additional internal control
for this VCT at this time .
The Company does not have a Remuneration
Committee as it does not have any executive
directors .
The Company does not have a Nomination
Committee as these matters are dealt with by
the Board .

•

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Statutory
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Audit Committee Report

This report is submitted in accordance with the 2019
AIC Code in respect of the year ended 31 December
2022 and describes the work of the Audit Committee
in discharging its responsibilities .

The Committee’s key objective is the provision of
effective governance of the appropriateness of the
Company’s financial reporting, the performance of the
auditor and the management of the internal control
and business risks systems . The Directors forming the
Audit Committee can be found on page 49 .

The Audit Committee’s terms of reference include
the following responsibilities:

•

reviewing and making recommendations
to the Board in relation to the Company’s
published Financial Statements and other formal
announcements relating to the Company’s
financial performance;
advising the Board on whether the Annual
Report and Financial Statements, taken as a
whole, is fair, balanced and understandable;
advising the Board on whether the Annual
Report and Financial Statements provides
necessary information for shareholders to assess
performance, business model and strategy;
reviewing and making recommendations to
the Board in relation to the Company’s internal
control (including internal financial control) and
risk management systems;
periodically considering the need for an internal
audit function;

• making recommendations to the Board in

•

relation to the appointment, re-appointment
and removal of the external auditor and
approving the remuneration and terms of
engagement of the external auditor;
reviewing and monitoring the external
auditors’ independence and objectivity and
the effectiveness of the audit process, taking
into consideration relevant UK professional
regulatory requirements; and

• monitoring the extent to which the external

auditor is engaged to supply non-audit services .

As part of the process of working with the Board to
maximise effectiveness, meetings of the Committee
usually take place immediately prior to a Board
meeting when appropriate and a report is provided
on relevant matters to enable the Board to carry out
its duties .

The Committee reviews its terms of reference and
its effectiveness periodically and recommends
to the Board any changes required as a result of
the review . The terms of reference are available
on request from the Company Secretary . The
Committee meets at least twice each year and on
an ad hoc basis as necessary . It has direct access
to the Company’s external auditor . During the
year we tendered the Company’s audit and after
a rigorous selection process HZW were chosen to
fill the casual vacancy . The Committee is happy
to recommend HZW for reappointment at the
AGM in relation to the audit for the year ending 31
December 2023 . HZW do not provide any non-
audit services and as such, the Committee does not
believe there is any risk that any non-audit services
can influence their independence or objectivity due
to any associated fee . When considering whether
to recommend the reappointment of the external
auditor the Committee takes into account the
quality of service, tenure of the current auditor in
addition to comparing the fees charged by similar
sized audit firms . Once the Committee has made
a recommendation to the Board in relation to the
appointment of the external auditor, this is then
ratified at the AGM through an Ordinary Resolution .
A resolution to approve the reappointment of HZW
will be proposed at the AGM on 18 May 2023 which
has been included in the Notice of AGM on pages 96
to 98 .

The effectiveness of the external audit is assessed
as part of the Board evaluation conducted annually
and by the quality and content of the Audit Plan and
Report provided to the Committee by the Auditor
and the resulting discussions on topics raised . The
Committee also challenges the Auditor when present
at a Committee meeting if appropriate .

The Company does not have an independent internal
audit function as it is not deemed appropriate
given the size of the Company and the nature of
the Company’s business . However, the Committee
considers annually whether there is a need for such
a function and if so would recommend this to the
Board . The Investment Manager was required to
appoint a depositary as part of its full-scope AIFM
status who is responsible for monitoring the cash
flows of the Company, overseeing the holding
of financial assets in custody on behalf of the
Company, verifying ownership interests, oversight
and supervision of the Investment Manager and
the Company and maintaining accurate records

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in relation to the above as required under the
Alternative Investment Fund Managers Directive
(Directive 2011/61/EU), transposed into UK law under
the European Union (Withdrawal) Act 2018 and as set
out in Fund 3 .11 of the FCA Handbook of rules and
guidance . As a result, the Directors do not consider
that a formal internal audit function would be a
required additional internal control for this VCT at
this time .

The Committee will monitor the significant risks at
each meeting and the Administration Manager will
work closely with the Auditors to mitigate the risks
and the resulting impact .

During the year ended 31 December 2022, the Audit
Committee discharged its responsibilities by:

•
•

•

tendering for and appointing new auditors;
reviewing and approving the external auditor’s
terms of engagement and remuneration;
reviewing the external auditor’s plan for the
audit of the Company’s Financial Statements,
including identification of key risks and
confirmation of auditor independence;
reviewing Seneca’s statement of internal
controls in relation to the Company’s business
and assessing the effectiveness of those controls
in minimising the impact of key risks;
reviewing the appropriateness of the Company’s
accounting policies;
reviewing the Company’s draft Annual Financial
and Interim results statements prior to Board
approval;
reviewing the Company’s going concern status
as referred to on pages 44 and 78; and
reviewing the external auditor’s Report to
the Audit Committee on the annual Financial
Statements .

The Committee has considered the Report and
Financial Statements for the year ended 31 December
2022 and has reported to the Board that it considers
them to be fair, balanced and understandable and
providing the information necessary for shareholders
to assess the Company’s performance, business
model and strategy .

Significant Risks

The Audit Committee is responsible for considering
and reporting on any significant risks that arise in
relation to the audit of the Financial Statements . The
Committee and the Auditors have identified the most
significant risks for the Company as:

•

Valuation and ownership of investment
portfolio: The Auditors give special audit
consideration to the valuation and ownership of
investments and the supporting data provided
by Seneca and the Board of the Company . The
impact of this risk could be a large movement
in the Company’s net asset value . Guidelines,

discussions, reviewing and challenging the
basis and reasonableness of assumptions
made in conjunction with available supporting
information goes into the valuation process . The
valuations are supported by investee company
Financial Statements and/or third-party
evidence where possible . Otherwise, valuations
are supported by the share price of the most
recent fundraising and/or management
information . These give comfort to the Audit
Committee .

• Management override of financial controls:

•

The Auditors specifically review all significant
accounting estimates that form part of the
Financial Statements and consider any material
judgements applied by the Board or Investment
Manager during the preparation of the Financial
Statements .
Compliance with HMRC conditions for
maintenance of approved VCT status:
Shoosmiths LLP provide the Company with
advice on the on-going compliance with the
HMRC rules and regulations concerning VCTs
and the Investment Manager and the Board
review the advice .
Recognition of revenue from investments:
Revenue is recognised when the Company’s
right to the return is established in accordance
with the Statement of Recommended Practice .
The Company had no revenue in 2022,
and Seneca has confirmed this to the Audit
Committee .
Performance Fees: The Auditors give special
audit consideration to any performance fees
as these are directly linked to the NAV which
is dependent upon investment valuations . The
Audit Committee gives due consideration to the
valuation methodology as referenced above and
maintains controls around performance fees
to mitigate any risks to the Company’s costs .
Details of the performance fee in relation to
the Ordinary share pool are included on pages
56 and 83 . There is no performance fee due in
respect of the B share pool .

These issues were discussed with Seneca, the Board
of Seneca Growth Capital and the Auditors at the
conclusion of the audit of the Financial Statements .

The Audit Committee is also responsible for
considering and reporting on any significant issues
that arise in relation to the audit of the Financial
Statements . The Audit Committee can confirm that
there were no significant issues to report to the
shareholders in respect of the audit of the Financial
Statements for the year ended 31 December 2022 .

Richard Roth
Audit Committee Chair
20 April 2023

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Directors’ Remuneration Report
and Policy

Annual Remuneration Report

This report is submitted in accordance with the
requirements of s420-422 of the Companies Act
2006, in respect of the year ended 31 December
2022 . A resolution to approve the Directors’
Remuneration Report will be proposed at the
Annual General Meeting on 18 May 2023 . The
Directors’ Remuneration Policy and the Directors’
Remuneration Report were last approved by
shareholders at the Annual General Meeting on 27
April 2022 .

The Company’s independent auditor, HZW, is
required to give its opinion on certain information
included in this report as indicated below . Their
report on these and other matters is set out on pages
60 to 64 .

Statement from the Chair of the
Board in relation to Directors’
Remuneration Matters

The Board is mindful of its obligation to set
remuneration at levels which will attract and
maintain an appropriate calibre of individuals
whilst simultaneously protecting the interests of
shareholders .

During the year to 31 December 2022, the Board
reviewed its existing remuneration levels, having
considered the remuneration payable to non-
executive directors of comparable VCTs, the demand
for non-executive directors within the financial
sector and the increasing regulatory requirements
with which the sector is required to comply . The
Board agreed to leave Directors’ fees unchanged
during the year (and in line with the prior year as
shown in the table on page 56) but continue to keep
them under review . As with any Board comprising
solely of non-executive directors it is unlikely that
a Director can fully abstain from any discussion
or decision concerning their own fees . Director’s
remuneration consists of a base fee for all Directors
and each Director participated in the process of
setting the level of this fee . Additional fees have been
set for the role of Chair of the Audit Committee and
the individual Director did not participate in setting
the additional fee for their own specific role . The
Board considers that this process is consistent with
the spirit of the AIC Code on the setting of Directors’
fees .

The Company’s Articles of Association limit the
aggregate amount that can be paid to the Directors
in fees to £100,000 per annum . A special resolution
has been included in this year’s AGM to amend

the Company’s Articles of Association to increase
the limit of the aggregate amount of Directors’
fees which can be paid to £150,000 per annum to
allow for the appointment of a new Director and to
increase fees as necessary in line with market rates
and inflation .

At the Annual General Meeting held on 27 April 2022,
the following votes were cast on the Poll voting on
the Remuneration Report:

For

Against

At Chair’s discretion

Number of
votes

% of votes
cast

2,285,883

99 .52

4,979

6,000

0 .22

0 .26

Total votes cast

2,296,862

100 .00

Number of votes
withheld

38,950

The Remuneration Policy was also last approved by
the shareholders at the Annual General Meeting held
on 27 April 2022 .

For

Against

At Chair’s discretion

Number of
votes

% of votes
cast

2,265,415

99 .52

4,979

6,000

0 .22

0 .26

Total votes cast

2,276,394

100 .00

Number of votes
withheld

59,418

Directors’ interests

The Directors’ interests, including those of
connected persons in the issued share capital of the
Company are outlined below . There is no minimum
holding requirement that the Directors need to
adhere to .

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Ordinary Shares

John Hustler
(Chair)

Richard Roth
(Chair of the Audit Committee)

Alex Clarkson

Richard Manley

B Shares

John Hustler
(Chair)

Richard Roth
(Chair of the Audit Committee)

Alex Clarkson

Richard Manley

31 December 2022

31 December 2021

Shares % of share capital

190,000

209,612

2 .34

2 .58

190,000

209,612

2 .34

2 .58

31 December 2022

31 December 2021

Shares % of share capital

31,841

15,000

10,060

96,059

0 .17

0 .08

0 .05

0 .51

19,735

15,000

10,060

71,846

0 .14

0 .10

0 .07

0 .49

Year ended
31 December
2022

Year ended
31 December
2021

Change
%

65,000

53,750

20 .93

700,400

727,000

(3 .66)

Total
remuneration

Dividends paid
(Note 13)

Directors’ Emoluments (Information Subject to
Audit)

The total emoluments in respect of qualifying
services of each person who served as a Director
during the year are as set out in the table below .
Richard Roth is entitled to a higher fee due to his role
as Chair of the Audit Committee .

There have been no changes in the Directors’
interests since 31 December 2022 . No options over
the share capital of the Company have been granted
to the Directors .

Details of the Directors’ remuneration are disclosed
below and in Note 4 on page 82 .

Pensions (Information Subject to Audit)

None of the Directors receives, or is entitled to
receive, pension benefits from the Company .

Share options and long-term incentive schemes
(Information Subject to Audit)

The Company does not grant any options over the
share capital of the Company nor operate long-term
incentive schemes .

Relative spend on pay

The table below sets out:

a)
b)

the remuneration paid to the Directors; and
the distributions made to shareholders by way
of dividends paid in the financial year ended 31
December 2022 and the preceding financial year .

No shares are held in Treasury .

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Directors’ Fees

John Hustler
(Chair)

Richard Roth
(Chair of the
Audit Committee)

31 December
2022

31 December
2021

15,000

20,000

Alex Clarkson

15,000

Richard Manley*

15,000

3,750

Total

65,000

53,750

* Richard Manley, a director of the Investment
Manager, elected to waive his Director’s fee until the
operating costs were less than the expenses cost
cap, which occurred in Q3 2021 . As such, Richard
Manley’s Director’s fee was taken for the 2022
financial year as payment to the Investment Manager .

The Directors did not receive any other form of
emoluments in addition to the Directors’ fees during
the year . John Hustler and Richard Roth, as members
of the CAC, may be entitled to performance fees
in the future as referred to below . Directors may
be entitled to fees from investee companies
when acting on the Company’s behalf as Director,
Observer or Consultant to those investees; however,
no Directors currently perform such a role in relation
to the Ordinary share pool and any fee that could
be payable in relation to the B share pool would be
payable to Seneca and would be disclosed in Note
18 . The Board will ensure that any such fee would
not present a conflict of interest which could impact
its independent judgement .

Total Shareholder Return Performance Graph

The graphs on pages 34 to 35 compare the NAV
return (rebased to 100) of the Company’s Ordinary
shares over the period from October 2001 to
December 2022 and the B shares from August 2018
to December 2022, with the total return from a
notional investment (rebased to 100) in the FTSE AIM
All-Share Index over the same period . This index is
considered to be the most appropriate equity market
against which investors can measure the relative
performance of the Company due to average market
cap per listing, risk profile and its investor base being
more directly comparable to the Company’s .

Statement of the Company’s policy on Directors’
Remuneration

The Board manages the Company and consists of
four non-executive Directors, who meet formally
as a Board at least four times a year and on other
occasions as necessary, to deal with the important
aspects of the Company’s affairs . Seneca is the
Company’s Investment Manager and is responsible
for the management of the investments made from
the B share pool, although management of the
investments in the Company’s Ordinary share pool
has been delegated to the remaining members of the
Board of the Company serving immediately prior to
the appointment of Seneca (the CAC), which now
consists of John Hustler and Richard Roth .

The performance incentive fees relevant to those
Directors serving up to 7 October 2015 were revised
under an agreement dated 7 October 2015 (the
“Accrued Performance Incentive Fee”) . The new
arrangements froze the sum due to those Directors
serving up to 7 October 2015 at £702,000 (the
accrued liability as disclosed in the 2014 audited
Financial Statements) which will only start to become
payable once a further 8 .75p of dividends have been
paid in respect of each Ordinary share (such that
original subscribing shareholders will have received
80p per share in dividends) . As no liability is payable
to any relevant Director more than five years after
his resignation from the Company, James Otter is
no longer entitled to any such fee: as explained in
Note 5, his potential share of any liability has been
extinguished and the remaining total potential
liability under the Accrued Performance Incentive
Fee has been reduced to £468,000 . This liability will
then be paid at the rate of 16 .67% of subsequent
dividends until a liability of £468,000 has been
discharged; this is in keeping with the original
approved arrangement . Following the payment
of this liability, any further performance fee in the
future will be payable at the reduced rate of 10% of
total distributions above the audited total return at
31 December 2014, with the outstanding balance
subject to a hurdle rate of 6% per annum, and will
be split between the members of the CAC based
on a formula driven by relative length of service
starting from 7 October 2015 (“Further Performance
Incentive Fee”) . Further details of the revised
arrangements are set out in Note 5 to the Financial
Statements .

The Company entered into an agreement with
Charles Breese following his resignation on 10 June
2019 that he may be entitled to a pro rata proportion
of performance fees as set out in Note 5 to the
Financial Statements .

The Board as a whole considers Directors’
remuneration and has not appointed a separate
committee in this respect .

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022
The Board intend to raise the basic fee payable to all non-executive Directors from £15,000 per annum to
£17,500 per annum with effect from the upcoming AGM on 18 May 2023 . The Company will also cover the
travel expenses of the non-executive Directors with effect from the same date . The additional fee of £5,000 per
annum currently paid to the Chair of the Audit Committee remains unchanged .

Company Strategy

To provide shareholders with an attractive income and capital return by investing its funds in a portfolio of both
unquoted and AIM/AQSE quoted UK companies . which meet the relevant criteria under the VCT rules .

Terms of Appointment

Directors are appointed with the expectation that they will serve for a period of at least three years . All Directors
retire at the first general meeting after election and thereafter will be subject to re-election on an annual basis in
line with practices recommended in the 2019 AIC Code . Re-election will be recommended by the Board but is
dependent upon a shareholder vote .

Each Director has received a letter of appointment . A Director may resign by notice in writing to the Board at
any time . Members of the CAC are entitled to a pro rata proportion of any performance fees payable to the CAC
accruing at the date of resignation up to five years from the date of resignation .

By order of the Board
ISCA Administration Services Limited
Company Secretary
20 April 2023

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Directors’ Responsibilities
Statement

The Directors are responsible for preparing the Annual Report and the Financial Statements in accordance with
applicable laws and regulations .

Company law requires the Directors to prepare Financial Statements for each financial year . Under that law
the Directors have elected to prepare the Financial Statements in accordance with United Kingdom Generally
Accepted Accounting Practice (United Kingdom Accounting Standards and applicable laws) . Under company law
the Directors must not approve the Financial Statements unless they are satisfied that they give a true and fair
view of the state of affairs and profit or loss of the Company for that period .

In preparing these Financial Statements, the Directors are required to:

select suitable accounting policies and then apply them consistently;

•
• make judgements and estimates that are reasonable and prudent;
•

state whether applicable UK Accounting Standards have been followed, subject to any material departures
disclosed and explained in the Financial Statements; and
prepare the Financial Statements on the going concern basis unless it is inappropriate to presume that the
Company will continue in business .

•

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain
the Company’s transactions and disclose with reasonable accuracy at any time the financial position of the
Company and enable them to ensure that the Financial Statements comply with the Companies Act 2006 . They
are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities .

The Directors are responsible for the maintenance and integrity of the corporate and financial information
included on the Company’s website . Legislation in the United Kingdom governing the preparation and
dissemination of Financial Statements may differ from legislation in other jurisdictions .

Each of the Directors confirms that, to the best of their knowledge:

•
•

•

there is no relevant audit information of which the Company’s auditor is unaware;
the Directors have taken all steps that they ought to have taken to make themselves aware of any relevant
audit information and to establish that the auditor is aware of that information;
the Financial Statements, prepared in accordance with the applicable set of accounting standards, give a
true and fair view of the assets, liabilities, financial position and profit or loss of the Company; and
the Investment Manager’s Report, Business Review and Directors’ Report includes a fair review of
the development and performance of the business and the position of the Company, together with a
description of the principal risks and uncertainties that it faces .

On behalf of the Board

John Hustler
Chair
20 April 2023

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Auditor’s
Report

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022
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Report of the Independent
Auditor to the Members of
Seneca Growth Capital VCT Plc

Opinion

We have audited the financial statements of Seneca
Growth Capital VCT Plc (the ‘Company’) for the
year ended 31 December 2022, which comprise the
Combined Income Statement, Combined Balance
Sheet, Combined Statement of Changes in Equity,
Combined Statement of Cash Flows and the related
notes to the financial statements, including a summary
of significant accounting policies . The financial
reporting framework that has been applied in their
preparation is applicable law and United Kingdom
Accounting Standards, including Financial Reporting
Standard 102 The Financial Reporting Standard
applicable in the UK and Republic of Ireland (United
Kingdom Generally Accepted Accounting Practice) .

In our opinion the financial statements:

•

give a true and fair view of the state of the
Company’s affairs as at 31 December 2022 and
of its net return for the year then ended;
have been properly prepared in accordance with
United Kingdom Generally Accepted Accounting
Practice;
have been prepared in accordance with the
requirements of the Companies Act 2006 .

Basis for opinion

We conducted our audit in accordance with
International Standards on Auditing (UK) ((ISAs
UK)) and applicable law . Our responsibilities
under those standards are further described in
the Auditor’s Responsibilities for the audit of the
financial statements section of our report . We are
independent of the Company in accordance with the
ethical requirements that are relevant to our audit
of the financial statements in the UK, including the
FRC’s Ethical Standard as applied to listed public
interest entities, and we have fulfilled our other
ethical responsibilities in accordance with these
requirements . We believe that the audit evidence we
have obtained is sufficient and appropriate to provide
a basis for our opinion .

Our approach to the audit

Our audit approach was based on a thorough
understanding of the Company’s business and is
risk-based . The day-to-day management of the
Company’s investment portfolio, the custody of its
investments and the maintenance of the Company’s
accounting records are outsourced to third-party
service providers . Accordingly, our audit work is
focused on obtaining an understanding of, and
evaluating, internal controls at the Company and
inspecting records and documents held by the third-
party service providers . We undertook substantive
testing on significant transactions, balances and

disclosures, the extent of which was based on
various factors such as our overall assessment of the
control environment, the effectiveness of controls
over individual systems and the management of
specific risks .

The audit team communicated throughout the audit
with the directors and investment managers in order
to ensure we had good knowledge of the business of
the Company . During the audit, we reassessed and
re-evaluated audit risks and tailored our approach
accordingly .

We communicated with those charged with
governance regarding, among other matters, the
planned scope and timing of the audit and significant
findings, including significant deficiencies in internal
control that we identified during the audit, if any .

Conclusions relating to going
concern

In auditing the financial statements, we have
concluded that the directors’ use of the going
concern basis of accounting in the preparation of the
financial statements is appropriate .

In making this assessment we have considered the
directors’ procedures for overseeing the activities
of the Company and reviewing its results and
forecasts . The application of those procedures has
been supported by us reviewing Board minutes and
other accessible documentation which confirm that
the directors regularly benchmark key performance
indicators which include but is not restricted to,
reviewing the net asset value per share and net
asset value total return per share and the frequent
monitoring of available funds, anticipated cash
outflows and financial headroom .

In conjunction with the evaluation of management’s
assessment of going concern, we have observed
that resources are carefully planned and managed
with the intention of ensuring that the Company
has sufficient resources available and accessible
to ensure that the Company’ commitments and
obligations are capable of being met as they fall due .

Our procedures also included an assessment of
whether the going concern disclosure in note 1
to the financial statements gives a complete and
accurate description of the directors’ assessment of
going concern .

Based on the work we have performed, we have
not identified any material uncertainties relating to
events or conditions that, individually or collectively,
may cast significant doubt on the Company’s
ability to continue as a going concern for a period

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of at least twelve months from when the financial
statements are authorised for issue . However, as we
cannot predict all future events or conditions and as
subsequent events may result in outcomes that are
inconsistent with judgements that were reasonable
at the time they were made, the above conclusions
are not a guarantee that the Company will continue
in operation .

In relation to the Company’s reporting on how it
has applied the UK Corporate Governance Code,
we have nothing material to add or draw attention
to in relation to the Directors’ Statement of
Responsibilities in the financial statements about
whether the directors considered it appropriate to
adopt the going concern basis of accounting .

Our responsibilities and the responsibilities of
the directors with respect to going concern are
described in the relevant sections of this report .

Key audit matters

Key audit matters are those matters that, in our
professional judgement, were of most significance in
our audit of the financial statements of the current
period and include the most significant assessed
risks of material misstatement (whether or not due
to fraud) we identified, including those which had
the greatest effect on: the overall audit strategy, the
allocation of resources in the audit; and directing the
efforts of the engagement team .

These matters were addressed in the context of our
audit of the financial statements as a whole, and in
forming our opinion thereon, and we do not provide
a separate opinion on these matters . In arriving at our
audit opinion above, key audit matters identified were
valuation, ownership and existence of investments,
and compliance with the VCT rules . This is not a
complete list of all risks identified by our audit .

Valuation, ownership and existence
of investments

The Company’s investment portfolio is one of the
key drivers of its results, of which 62% is represented
by quoted investments and 38% by unquoted
investments .

Quoted investments are not considered to be at
a high risk of material misstatement in terms of
valuation, or to be subject to a significant level
of judgement, because they comprise liquid
investments, for which evidence of the market price
is readily available . However, due to their materiality
in the context of the financial statements as a whole,
they are considered to be a significant risk area .

Our audit work included, but was not restricted to,
consideration of the design and implementation of
controls over the pricing of quoted investments and
agreeing 100% of investment prices to independent
sources . We considered the appropriateness of the
use of the quoted bid price by reviewing the liquidity
of the market of the quoted investments held .

The valuation of unquoted investments involves
significant judgements and estimates . In particular,
we look at where the directors made subjective
judgements in respect of significant accounting
estimates that involved making assumptions and
considering future events that are inherently
uncertain .

We obtained an understanding of how the valuations
were performed and considered whether the
method chosen was in accordance with published
guidance and reviewed and challenged the
assumptions applied to the valuation inputs . We
verified and benchmarked key inputs and estimates
to independent information from our own research
and against metrics from the investments and where
appropriate, we performed sensitivity analysis on
the valuation calculations and alternative valuation
methods were considered and discussed with
management to provide alternative views on the
value of the investments .

Further, we also considered the economic
environment in which the investments operate in
to identify factors that could impact the investment
valuation .

Ownership and existence are also considered
significant risks . We confirmed investment
holdings to custodian report, share certificates and
Companies House .

Key observations

Our testing did not identify any material
misstatements in the valuation of the Company’s
investment portfolio as at the year end .

Compliance with VCT rules

Compliance with the VCT rules is necessary to
maintain the VCT status and associated tax benefits .
Our audit work included, but was not restricted to:

•

Reviewing of the design and implementation
of controls around the ongoing internal
assessment and monitoring of VCT compliance .

• Obtaining an understanding of the processes
adopted and evidenced the work completed
by the Investment Manager on documenting
compliance with the key VCT rules and
directors’ review of this on a regular basis .
Testing the conditions for maintaining approval as
a VCT as set out by HMRC . Each of the conditions
was reviewed in turn in order to assess whether it
had been met as at the year-end .

•

Key observations

We reviewed the documentation maintained, that
confirmed the Company was in compliance with
the VCT rules during the period and at the year end .
Further our own testing of compliance with the
individual VCT rules did not identify any breaches .

Our application of materiality

We apply the concept of materiality in planning and
performing our audit, in evaluating the effect of any
identified misstatements and in forming our opinion .
For the purpose of determining whether the financial
statements are free from material misstatement,
we define materiality as the magnitude of a
misstatement or an omission from the financial
statements or related disclosures that would make it
probable that the judgement of a reasonable person,
relying on the information would have been changed
or influenced by the misstatement or omission . We
also determine a level of performance materiality,
which we use to determine the extent of testing
needed, to reduce to an appropriately low-level the
probability that the aggregate of uncorrected and

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undetected misstatements exceeds materiality for
the financial statements as a whole .

otherwise explicitly stated in our report, we do not
express any form of assurance conclusion thereon .

We established materiality for the financial
statements as a whole to be £184,000, which is
1% of the value of the Company’s total assets . This
is the amount representing the total magnitude
of misstatements that we expect to influence the
economic decisions of the users of these financial
statements .

A key judgement in determining materiality
(and performance materiality) is the appropriate
benchmark to select . We considered which
benchmarks and key performance indicators have
the greatest bearing on shareholder decisions .
We determined that the total assets is the key
benchmark to use in setting materiality given the
Company’s objective is for capital appreciation
(increase value of investments) . When using total
assets to determine overall materiality, our approach
is to apply a percentage between 0 .5% and 2% to
the amount . In setting overall materiality, we applied
a rate of 1 % which is towards the lower end of
the allowable percentage range, being a listed and
regulated entity .

We have considered performance materiality at
a level of 75% of materiality for the Company’s
financial statements as a whole, which equates
to £138,000 . We applied this percentage in our
determination of performance materiality because
the valuation of unquoted investments is subject to a
significant level of judgement and is considered to be
at a high risk of material misstatement .

Audit misstatement posting threshold is determined
to be £9,000, which is 5% of materiality . This is the
amount below which identified misstatements are
considered to be clearly trivial from a quantitative
point of view . We may become aware of differences
below this threshold which could alter the nature,
timing and scope of our audit procedures, for
example if we identify smaller differences which are
indicators of fraud .

For income and expenditure items we determined
that misstatements of lesser amounts than
materiality for the financial statements as a whole
would make it probable that the judgement of
a reasonable person, relying on the information
would have been changed or influenced by
the misstatement or omission . Accordingly, we
established materiality for revenue items within the
income statement to be £67,000, which is 25% of the
Company’s net revenue return on ordinary activities
before taxation . Net revenue return excludes realised
gain or loss on sale of investments and unrealised
gain or loss on valuation of investments as these
were considered in testing of investments using
balance sheet materiality of £184,000 .

Other information

The directors are responsible for the other
information contained within the annual report .
The other information comprises the information
included in the annual report, other than the
financial statements and our auditor’s report thereon .
Our opinion on the financial statements does not
cover the other information and, except to the extent

In connection with our audit of the financial
statements, our responsibility is to read the other
information and, in doing so, consider whether
the other information is materially inconsistent
with the financial statements, or our knowledge
obtained in the audit or otherwise appears to be
materially misstated . If we identify such material
inconsistencies or apparent material misstatements,
we are required to determine whether there is a
material misstatement in the financial statements or
a material misstatement of the other information . If,
based on the work we have performed, we conclude
that there is a material misstatement of this other
information, we are required to report that fact .

We have nothing to report in this regard .

In this context, we also have nothing to report in
regard to our responsibility to specifically address
the following items in the other information and to
report as uncorrected material misstatements of the
other information where we conclude that those
items meet the following conditions:

•

Fair, balanced and understandable, set out
on page 41 – the statement given by the
directors that they consider the annual report
and financial statements taken as a whole is fair,
balanced and understandable and provides the
information necessary for shareholders to assess
the Company’s performance, business model
and strategy, is materially inconsistent with our
knowledge obtained in the audit; or
Audit committee reporting, set out on pages
52 to 53 – the section describing the work of
the audit committee does not appropriately
address matters communicated by us to the
audit committee; or

• Directors’ statement of compliance with
the UK Corporate Governance Code, set
out on page 50 – the parts of the Directors’
Report required under the Listing Rules relating
to the Company’s compliance with the UK
Corporate Governance Code containing
provisions specified for review by the auditors in
accordance with Listing Rule 9 .8 .10R (2) do not
properly disclose a departure from a relevant
provision of the UK Corporate Governance
Code .

Opinion on other matters prescribed
by the Companies Act 2006

In our opinion, based on the work undertaken in the
course of the audit:

•

the part of the Directors’ Remuneration Report
to be audited has been properly prepared in
accordance with the Companies Act 2006;
the information given in the Strategic Report
and the Directors’ Report for the financial year
for which the financial statements are prepared
is consistent with the financial statements and
those reports have been prepared in accordance
with applicable legal requirements;
the information about internal control and risk
management systems in relation to financial
reporting processes and about share capital

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structures, given in compliance with rules
7 .2 .5 and 7 .2 .6 in the Disclosure Rules and
Transparency Rules sourcebook made by the
Financial Conduct Authority (the FCA Rules), is
consistent with the financial statements and has
been prepared in accordance with applicable
legal requirements; and
information about the Company’s corporate
governance code and practices and about its
administrative, management and supervisory
bodies and their committees complies with rules
7 .2 .2, 7 .2 .3 and 7 .2 .7 of the FCA Rules .

•

Matters on which we are required to
report by exception

In light of the knowledge and understanding of
the Company and its environment obtained in the
course of the audit, we have not identified material
misstatements in:

•
•

the Strategic Report or the Directors’ Report; or
the information about internal control and risk
management systems in relation to financial
reporting processes and about share capital
structures, given in compliance with rules 7 .2 .5
and 7 .2 .6 of the FCA Rules .

We have nothing to report in respect of the following
matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:

•

adequate accounting records have not been
kept, or returns adequate for our audit have not
been received from branches not visited by us;
or
the financial statements and the part of the
Directors’ Remuneration Report to be audited
are not in agreement with the accounting
records and returns; or
certain disclosures of directors’ remuneration
specified by law are not made; or

• we have not received all the information and
explanations we require for our audit; or
a corporate governance statement has not been
prepared by the Company .

•

Corporate governance statement

The Listing Rules require us to review the directors’
statement in relation to going concern, longer-term
viability and that part of the Corporate Governance
Statement relating to the Company’s compliance
with the provisions of the UK Corporate Governance
Statement specified for our review .

Based on the work undertaken as part of our audit,
we have concluded that each of the following
elements of the Corporate Governance Statement is
materially consistent with the financial statements or
our knowledge obtained during the audit:

•

the disclosures in the annual report set out on
pages 37 to 38 that describe the principal risks
and explain how they are being managed or
mitigated;
the directors’ confirmation set out on page
37 in the annual report that they have carried
out a robust assessment of the principal risks
facing the Company, including those that would
threaten its business model, future performance,
solvency or liquidity;

•

the section in the annual report set out on page
38 that describes the review of the effectiveness
of Company’s risk management and internal
control systems, covering all material controls,
including financial, operational and compliance
controls;
the section in the annual report set out on pages
52 to 53 that describes the work of the audit
committee, including the significant issues that
the audit committee considered relating to the
financial statements, if any, and how these issues
were addressed;
the directors’ statement set out on page 44
in the financial statements about whether the
directors considered it appropriate to adopt the
going concern basis of accounting in preparing
the financial statements and the directors’
identification of any material uncertainties to
the Company’s ability to continue to do so over
a period of at least twelve months from the date
of approval of the financial statements;
• whether the directors’ statement relating to

•

going concern required under the Listing Rules
in accordance with Listing Rule 9 .8 .6R(3) is
materially inconsistent with our knowledge
obtained in the audit; or
the directors’ explanation set out on page 37 in
the annual report as to how they have assessed
the prospects of the Company, over what period
they have done so and why they consider that
period to be appropriate, and their statement as
to whether they have a reasonable expectation
that the Company will be able to continue in
operation and meet its liabilities as they fall due
over the period of their assessment, including
any related disclosures drawing attention to any
necessary qualifications or assumptions .

Responsibilities of directors

As explained more fully in the Directors’
Responsibilities Statement (set out on page 58), the
directors are responsible for the preparation of the
financial statements and for being satisfied that they
give a true and fair view, and for such internal control
as the directors determine is necessary to enable the
preparation of financial statements that are free from
material misstatement, whether due to fraud or error .

In preparing the financial statements, the directors
are responsible for assessing the Company’s
ability to continue as a going concern, disclosing,
as applicable, matters related to going concern
and using the going concern basis of accounting
unless the directors either intend to liquidate the
Company or to cease operations, or have no realistic
alternative but to do so .

Auditor’s Responsibilities for the audit
of the financial statements

Our objectives are to obtain reasonable assurance
about whether the financial statements as a whole
are free from material misstatement, whether due
to fraud or error, and to issue an auditor’s report
that includes our opinion . Reasonable assurance is
a high level of assurance, but is not a guarantee that
an audit conducted in accordance with ISAs (UK)
will always detect a material misstatement when it
exists . Misstatements can arise from fraud or error

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and are considered material if, individually or in the
aggregate, they could reasonably be expected to
influence the economic decisions of users taken on
the basis of these financial statements .

Extent to which the audit was capable of detecting
irregularities, including fraud

Irregularities, including fraud, are instances of
non-compliance with laws and regulations . We
design procedures in line with our responsibilities,
outlined above, to detect material misstatements in
respect of irregularities, including fraud . The extent
to which our procedures are capable of detecting
irregularities, including fraud is detailed below:

We considered the nature of the Company’s
industry and its control environment and reviewed
the Company’s documentation of its policies
and procedures relating to fraud and compliance
with laws and regulations . We also enquired of
management about their own identification and
assessment of the risks of irregularities .

We obtained an understanding of the legal and
regulatory framework that the Company operates
in and identified the key laws and regulations that
had a direct effect on the determination of material
amounts and disclosures in the financial statements,
including the UK Companies Act and tax legislation,
and, those that do not have a direct effect on the
financial statements but compliance with which may
be fundamental to the Company’s ability to operate
or to avoid a material penalty .

We discussed among the audit engagement team
regarding the opportunities and incentives that may
exist within the organisation for fraud and how and
where fraud might occur in the financial statements .

In common with all audits under ISAs (UK), we are
also required to perform specific procedures to
respond to the risk of management override . In
addressing the risk of fraud through management
override of controls, we tested the appropriateness
of journal entries and other adjustments; assessed
whether the judgments made in accounting
estimates are indicative of a potential bias; and
evaluated the business rationale of any significant
transactions that are unusual or outside the normal
course of business .

In addition to the above, our procedures to respond
to the risks identified included the following:

•

reviewing financial statement disclosures by
testing to supporting documentation to assess
compliance with provisions of relevant laws and
regulations described as having a direct effect
on the financial statements;
performing analytical procedures to identify any
unusual or unexpected relationships that may
indicate risks of material misstatements due to
fraud;
enquiring of management concerning actual
and potential litigation and claims and instances
of non-compliance with laws and regulations;
and
reading minutes of meetings of those charged
with governance .

Our audit procedures were designed to respond
to risks of material misstatement in the financial
statements, recognising that the risk of not detecting
a material misstatement due to fraud is higher than
the risk of not detecting one resulting from error,
as fraud may involve deliberate concealment by, for
example, forgery, misrepresentations or through
collusion . There are inherent limitations in the audit
procedures performed and the further removed
non-compliance with laws and regulations is from
the events and transactions reflected in the financial
statements, the less likely we are to become aware
of it .

A further description of our responsibilities for the
audit of the financial statements is located on the
Financial Reporting Council’s website at www .frc .
org .uk/auditorsresponsibilities . This description
forms part of our auditor’s report .

Other matters which we are required
to address

We were appointed by the Audit Committee on
10 May 2022 . The period of total uninterrupted
engagement including previous renewals and
reappointments of the firm is one year .

The non-audit services prohibited by the FRC’s
Ethical Standard were not provided to the Company
and we remain independent of the Company in
conducting our audit .

Other than those disclosed in the corporate
governance report, we have provided no non-
audit services to the Company in the period from 1
January 2022 to 31 December 2022 .

Our audit opinion is consistent with the additional
report to the audit committee .

Use of our report

This report is made solely to the Company’s
members, as a body, in accordance with chapter
3 of part 16 of the Companies Act 2006 . Our audit
work has been undertaken so that we might state
to the Company’s members those matters we are
required to state to them in an auditors’ report and
for no other purpose . To the fullest extent permitted
by law, we do not accept or assume responsibility to
anyone other than the Company and the Company’s
members as a body, for our audit work, for this
report, or for the opinions we have formed .

Scott Lawrence FCA (Senior Statutory Auditor)
for and on behalf of Hazlewoods LLP
Staverton Court
Staverton
Cheltenham
GL51 0UX

20 April 2023

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022

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Financial
Statements

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022
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Combined Income Statement

Combined

Year to 31 December 2022

Year to 31 December 2021

Note

Revenue

Capital

Total

Revenue

Capital

£’000

Total

£’000

Gain on disposal of fixed asset
investments

(Loss)/gain on valuation of fixed
asset investments

Performance fee

Investment management fee net of
cost cap

Other expenses

Return on ordinary activities
before tax

Taxation on return on ordinary
activities

Return on ordinary activities after
tax

Return on ordinary activities after tax
attributable to:

Owners of the fund

290

(2,554)

(2)

1,027

1,609

(158)

(70)

(215)

(285)

(53)

(158)

(211)

(198)

(171)

(268)

(2,481)

(2,749)

(224)

2,320

2,096

(268)

(2,481)

(2,749)

(224)

2,320

2,096

(268)

(2,481)

(2,749)

(244)

2,320

2,096

There was no other Comprehensive Income recognised during the year .

•

•
•

•

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

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

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

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022
Ordinary Share Income Statement
(Non-statutory Analysis)

Ordinary shares

Year to 31 December 2022

Year to 31 December 2021

Note

Revenue

Capital

Total

Revenue

Capital

£’000

Total

£’000

Gain on disposal of fixed asset
investments

(Loss)/gain on valuation of fixed
asset investments

Performance fee

Investment management fee

Other expenses

Return on ordinary activities
before tax

Taxation on return on ordinary
activities

Return on ordinary activities after
tax

Return on ordinary activities after tax
attributable to:

Ordinary shareholders

Earnings per share – basic and
diluted

(28)

(43)

(2)

(28)

(16)

1,121

(158)

(16)

(28)

(16)

1,045

1,029

(16)

1,045

1,029

(28)

(16)

1,045

1,029

(0 .3)p

0 .5p

0 .2p

(0 .2)p

12 .8p

12 .6p

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Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022
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B Share Income Statement
(Non-statutory Analysis)

B shares

Year to 31 December 2022

Year to 31 December 2021

Note

Revenue

Capital

Total

Revenue

Capital

£’000

Total

£’000

204

(2,511)

945

488

(70)

(215)

(285)

(53)

(158)

(211)

(170)

(155)

(240)

(2,522)

(2,762)

(208)

1,275

1,067

(240)

(2,522)

(2,762)

(208)

1,275

1,067

(240)

(2,522)

(2,762)

(208)

1,275

1,067

(1 .4)p

(15 .1)p

(16 .5)p

(1 .7)p

10 .6p

8 .9p

Gain on disposal of fixed asset
investments

(Loss)/gain on valuation of fixed
asset investments

Performance fee

Investment management fee net of
cost cap

Other expenses

Return on ordinary activities
before tax

Taxation on return on ordinary
activities

Return on ordinary activities after
tax

Return on ordinary activities after tax
attributable to:

B shareholders

Earnings per share – basic and
diluted

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022
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Combined Balance Sheet

Combined

As at 31 December
2022

As at 31 December
2021

Note

£’000

Fixed asset investments*

13,576

11,165

Current assets:

Debtors

Cash and cash equivalents

5,065

Creditors: amounts falling due within one year

(168)

7,105

(165)

Net current assets

4,907

6,949

Creditors: amounts falling due after more than
one year

(353)

(351)

Net assets

Called up equity share capital

Share premium

Capital redemption reserve

Special distributable reserve

Capital reserve – realised gains and losses

Capital reserve – holding gains and losses

Revenue reserve

Total equity shareholders' funds

*At fair value through profit and loss

18,130

269

14,537

5,642

2,113

(1,682)

(2,749)

18,130

17,763

227

10,738

6,367

2,639

273

(2,481)

17,763

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

The statements were approved by the Directors and authorised for issue on 20 April 2023 and are signed on
their behalf by:

John Hustler
Chair
Company No: 04221489

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022
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Ordinary Share Balance Sheet
(Non-statutory Analysis)

Fixed asset investments*

Current assets:

Debtors

Cash and cash equivalents

Creditors: amounts falling due within one year

Ordinary shares

As at 31 December
2022

As at 31 December
2021

Note

£’000

409

(22)

2,974

318

(22)

3,212

Net current assets

387

296

Creditors: amounts falling due after more than
one year

(353)

(351)

Net assets

Called up equity share capital

Share premium

Capital redemption reserve

Special distributable reserve

Capital reserve – realised gains and losses

Capital reserve – holding gains and losses

Revenue reserve

Total equity shareholders' funds

Net asset value per share

*At fair value through profit and loss

3,008

3,598

985

333

(1,989)

3,008

37 .1p

3,157

3,760

1,531

(254)

(1,961)

3,157

38 .9p

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022
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B Share Balance Sheet
(Non-statutory Analysis)

B shares

As at 31 December
2022

As at 31 December
2021

Note

£’000

Fixed asset investments*

10,602

Current assets:

Debtors

Cash and cash equivalents

4,656

Creditors: amounts falling due within one year

(146)

Net current assets

Creditors: amounts falling due after more than
one year

Net assets

Called up equity share capital

Share premium

Capital redemption reserve

Special distributable reserve

Capital reserve – realised gains and losses

Capital reserve – holding gains and losses

Revenue reserve

Total equity shareholders' funds

Net asset value per share

*At fair value through profit and loss

4,520

15,122

188

14,537

2,044

1,128

(2,015)

(760)

15,122

80 .7p

6,787

(143)

7,953

6,653

14,606

146

10,738

2,607

1,108

527

(520)

14,606

100 .1p

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022
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Combined Statement of
Changes in Equity

Share
capital

Share
premium

Capital
Redemption
Reserve

Special
distributable
reserve

Capital
reserve
realised
gains/
(losses)

Capital
reserve
holding
gains/
(losses)

Revenue
reserve

Total

£’000

Balance as at
1 January 2021

172

5,169

B share issue

5,569

Revenue return on
ordinary activities after
tax

Expenses charged to
capital

Performance fee
allocated as capital
expenditure

Dividends paid

Current period gains
on disposal

Current period gains
on fair value of
investments

Prior years’ unrealised
profits now realised

Balance as at
31 December 2021

227

10,738

B share issue

3,799

Own shares purchased
for cancellation

Revenue return on
ordinary activities after
tax

Expenses charged to
capital

Performance fee
allocated as capital
expenditure

Dividends paid

Current period gains
on disposal

Current period losses
on fair value of
investments

Prior years' unrealised
losses now realised

Balance as at
31 December 2022

269

14,537

7,094

1,704

(1,112)

(2,257)

10,770

(158)

(727)

1,027

1,609

224

(224)

5,624

(224)

(158)

(727)

1,027

1,609

6,367

2,639

273

(2,481)

17,763

(25)

(700)

(215)

(2)

290

(2,554)

(599)

599

3,841

(25)

(268)

(215)

(2)

(700)

290

(2,554)

5,642

2,113

(1,682)

(2,749)

18,130

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

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022
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Ordinary Shares Statement
of Changes in Equity
(Non-statutory Analysis)

Share
capital

Share
premium

Capital
Redemption
Reserve

Special
distributable
reserve

Capital
reserve
realised
gains/
(losses)

Capital
reserve
holding
gains/
(losses)

Revenue
reserve

Total

£’000

Balance as at
1 January 2021

Revenue return on
ordinary activities after
tax

Expenses charged to
capital

Performance fee
allocated as capital
expenditure

Dividends paid

Current period gains
on disposal

Current period gains
on fair value of
investments

Prior years’ unrealised
profits now realised

Balance as at
31 December 2021

Revenue return on
ordinary activities after
tax

Expenses charged to
capital

Performance fee
allocated as capital
expenditure

Dividends paid

Current period gains
on disposal

Current period losses
on fair value of
investments

Prior years’ unrealised
losses now realised

Balance as at
31 December 2022

4,085

1,532

(1,300)

(1,945)

2,453

(325)

(158)

1,121

(75)

(16)

(158)

(325)

1,121

3,760

1,531

(254)

(1,961)

3,157

(162)

(2)

(43)

(630)

630

(28)

(2)

(162)

(43)

3,598

985

333

(1,989)

3,008

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022
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B Shares Statement of
Changes in Equity
(Non-statutory Analysis)

Share
capital

Share
premium

Capital
Redemption
Reserve

Special
distributable
reserve

Capital
reserve
realised
gains/
(losses)

Capital
reserve
holding
gains/
(losses)

Revenue
reserve

Total

£’000

Balance as at
1 January 2021

B share issue

Revenue return on
ordinary activities after
tax

Expenses charged to
capital

Dividends paid

Current period gains
on disposal

Current period gains
on fair value of
investments

Prior years’ unrealised
profits now realised

Balance as at
31 December 2021

5,169

5,569

146

10,738

B share issue

3,799

Own shares purchased
for cancellation

Revenue return on
ordinary activities after
tax

Expenses charged to
capital

Dividends paid

Current period gains
on disposal

Current period losses
on fair value of
investments

Prior years’ unrealised
profits now realised

Balance as at
31 December 2022

188

14,537

3,009

172

188

(312)

8,317

(402)

(158)

945

488

149

(149)

5,624

(208)

(158)

(402)

945

488

2,607

1,108

527

(520)

14,606

(25)

(538)

(215)

204

(2,511)

(31)

3,841

(25)

(240)

(215)

(538)

204

(2,511)

2,044

1,128

(2,015)

(760)

15,122

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022
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Combined Statement of
Cash Flows

Combined

Year to
31 December 2022

Year to
31 December 2021

Note

£’000

Cash flows from operating activities:

Return on ordinary activities before tax

(2,749)

2,096

Adjustments for:

Increase in debtors

Increase in creditors

Gain on disposal of fixed asset investments

Loss / (gain) on valuation of fixed asset investments

Cash from operations

Income taxes paid

Net cash used in operating activities

Cash flows from investing activities:

Purchase of fixed asset investments

Sale of fixed asset investments

Total cash outflow from investing activities

Cash flows from financing activities:

Dividend paid

Own shares purchased for cancellation

Issue of B shares

Awaiting B share issue

Total cash inflow from financing activities

(Decrease) / increase in cash and cash equivalents

Opening cash and cash equivalents

Closing cash and cash equivalents

(1)

(290)

2,554

(481)

(5,920)

1,245

(4,675)

(700)

(25)

3,841

3,116

(2,040)

7,105

5,065

(2)

254

(1,027)

(1,609)

(288)

(4,613)

2,207

(2,406)

(727)

(25)

5,624

(154)

4,743

2,049

5,056

7,105

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

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022
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Ordinary Shares Statement of Cash
Flows (Non-statutory Analysis)

Ordinary shares

Year to
31 December 2022

Year to
31 December 2021

Note

£’000

Cash flows from operating activities:

Return on ordinary activities before tax

Adjustments for:

(Increase)/decrease in debtors

Increase in creditors

Gain on disposal of fixed asset investments

Loss / (gain) on valuation of fixed asset investments

Cash from operations

Income taxes paid

Net cash used in operating activities

Cash flows from investing activities:

Purchase of fixed asset investments

Sale of fixed asset investments

Total cash inflow from investing activities

Cash flows from financing activities:

Dividend paid

Total cash outflow from financing activities

Increase / (decrease) in cash and cash equivalents

Opening cash and cash equivalents

Closing cash and cash equivalents

(86)

(28)

281

(162)

318

409

1,029

158

(82)

(1,121)

(16)

(85)

217

132

(325)

(209)

527

318

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022
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B Shares Statement of Cash
Flows (Non-statutory Analysis)

Ordinary shares

Year to

31 December 2022

31 December 2021

B shares

Year to
31 December 2022

Year to
31 December 2021

Note

£’000

Note

£’000

Cash flows from operating activities:

Return on ordinary activities before tax

1,029

Return on ordinary activities before tax

(2,762)

1,067

Gain on disposal of fixed asset investments

Loss / (gain) on valuation of fixed asset investments

(1,121)

Loss / (gain) on valuation of fixed asset investments

Adjustments for:

Increase in debtors

Increase in creditors

Cash from operations

Income taxes paid

Net cash used in operating activities

Cash flows from investing activities:

Purchase of fixed asset investments

Sale of fixed asset investments

Total cash inflow from investing activities

Total cash outflow from investing activities

Increase / (decrease) in cash and cash equivalents

Issue of B shares

Cash flows from financing activities:

Dividend paid

Own shares purchased for cancellation

Awaiting B share issue

Total cash inflow from financing activities

(Decrease) / increase in cash and cash equivalents

Opening cash and cash equivalents

Closing cash and cash equivalents

(1)

(204)

2,511

(453)

(5,920)

964

(4,956)

(538)

(25)

3,841

3,278

(2,131)

6,787

4,656

(2)

(945)

(488)

(272)

(4,528)

1,990

(2,538)

(402)

5,624

(154)

5,068

2,258

4,529

6,787

Adjustments for:

(Increase)/decrease in debtors

Increase in creditors

Cash from operations

Income taxes paid

Net cash used in operating activities

Cash flows from investing activities:

Purchase of fixed asset investments

Sale of fixed asset investments

Cash flows from financing activities:

Dividend paid

Total cash outflow from financing activities

Opening cash and cash equivalents

Closing cash and cash equivalents

(86)

(28)

281

(162)

318

409

158

(82)

(16)

(85)

217

132

(325)

(209)

527

318

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022
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Notes to the Financial Statements

1 . Principal Accounting Policies

Basis of preparation

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

The principal accounting policies have remained materially unchanged from those set out in the Company’s
2021 Annual Report and Financial Statements . A summary of the principal accounting policies is set out below .

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

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

Going Concern

The assets of the Company consist mainly of securities, sixteen of which are AIM quoted (2021: ten), quite liquid
and readily accessible, as well as cash . As at 31 December 2022, 28% of net assets was cash (2021: 40%) . After
reviewing the Company’s forecasts and expectations, the Directors have a reasonable expectation that the
Company has adequate resources to continue in operational existence for the foreseeable future . The Company
therefore continues to adopt the going concern basis in preparing its Financial Statements .

The Company continues to face material market volatility as a result of macroeconomic pressures . The
Company’s Board and Investment Manager are focused on ensuring that investee companies are taking the
required actions to minimise the potential impact that these conditions could have on them . The Board and
Seneca will continue to review these potential risks and keep those risks under regular review but do not
consider current macroeconomic pressures to have a material impact on the Company’s own ability to continue
as a going concern .

Key judgements and estimates

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

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

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

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022

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Functional and presentational currency

The Financial Statements are presented in Sterling (£) . The functional currency is also Sterling (£) .

Cash and cash equivalents

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

Fixed asset investments

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

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

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

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

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

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

Fair value hierarchy

Paragraph 34 .22 of FRS 102 regarding financial instruments that are measured in the balance sheet at fair value
requires disclosure of fair value measurements dependent on whether the stock is quoted and the level of the
accuracy in the ability to determine its fair value . The fair value measurement hierarchy is as follows:

For quoted investments:

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

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

For investments not quoted in an active market:

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

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022

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Current asset investments

No current asset investments were held at 31 December 2022 or 31 December 2021 . Should current assets be
held, gains and losses arising from changes in fair value of investments are recognised as part of the capital
return within the Income Statement and allocated to the capital reserve - gains/(losses) on disposal .

Income

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

The Company has not generated any income in 2022 (2021: £nil) .

Expenses

All expenses are accounted for on an accruals basis . Expenses are charged wholly to revenue with the exception
of the performance and management fee . The performance fee is charged 100% to the capital reserve and the
investment management fee charged to the B shares has been split 25% revenue and 75% capital, in line with
industry practice and to reflect the Board’s estimated split of investment returns which will be achieved by the
Company’s B shares over the long term . Expenses and liabilities not specific to a share class were chargeable to
the B share pool for a period of three years from 1 July 2018 (subject to the cost cap discussed in Note 2) . Since
1 July 2021, expenses are allocated pro-rata between the B shares and Ordinary shares based on their respective
net asset values . These costs, including the annual management fee in the case of the B share pool, are capped
at 3% of the net asset value of each share class .

Revenue and capital

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

Taxation

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

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

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

Financial instruments

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

Capital management is monitored and controlled using the internal control procedures set out on page 49 of
this report . The capital being managed includes equity and fixed-interest investments, cash balances and liquid
resources including debtors and creditors .

The Company does not have any externally imposed capital requirements .

Reserves

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

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

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022

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Capital redemption reserve – represents the nominal value of shares bought back from shareholders and
cancelled .

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

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

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

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

Dividends Payable

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

2 . Investment Management Fees for B shares

Gross investment management fee

Cost cap refund from Seneca

Investment management fee net of cost cap

Year to
31 December 2022
£’000

Year to
31 December 2021
£’000

303

(18)

285

246

(35)

211

Seneca is entitled to an annual management fee of 2% of the weighted net asset value of the B share pool (2021:
2%) and, with effect from 1 August 2019, is also entitled to an annual fee of £9,000 (plus VAT, if applicable) in
relation to management accounting services . These fees are payable quarterly in arrears . Seneca will also be
entitled to certain monitoring fees from investee companies and the Board reviews the amounts (please see
Note 18) .

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

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

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

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

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022

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The Investment Manager will indemnify the Company for any excess over the cost cap, with an amount equal
to such excess either being paid by Seneca to the Company or refunded by way of a reduction to its fees .
Accordingly, Seneca reduced its management fee by £18,000 in the year to 31 December 2022 (2021: reduced
by £35,000) .

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

3 . Other Expenses

Directors’ remuneration and social security costs

Fees payable to the Company’s auditor for the audit of the
Financial Statements

Legal and professional expenses

Accounting and administration services

Other expenses (revenue)

Other expenses (capital)

Year to
31 December 2022
£’000

Year to
31 December 2021
£’000

198

171

All expenses were charged to the Ordinary shares for the period to 30 June 2018 . In line with the offer for
subscription for B shares, and following the initial allotment of B shares on 23 August 2018, all the Company’s
general expenses are chargeable to the B share pool for a period of three years from 1 July 2018 (subject to the
cost cap discussed in Note 2) . Since 1 July 2021, expenses have been capped at 3% across both the Ordinary
share pool and the B share pool pro-rata to their respective net asset values . Any expenditure related specifically
to assets in one pool is chargeable to that pool .

4 . Directors’ Remuneration

Directors’ emoluments:

John Hustler (Chair)

Richard Roth

Alex Clarkson

Richard Manley

Year to
31 December 2022
£

Year to
31 December 2021
£

15,000

20,000

15,000

65,000

15,000

20,000

15,000

3,750

53,750

Richard Manley, a director of the Investment Manager, previously elected to waive his Director’s fee, until the
Company’s operating costs were less than the expenses cost cap . Given the operating costs were less than the
cost cap in Q4 2021, Richard Manley started taking his Director fee in 2022 . This was paid to Seneca .

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

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022

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N

Directors’ emoluments are exclusive of employers’ National Insurance contributions, which totalled £3,212
(2021: £3,240 ) . Together, the Directors’ remuneration and social security costs totalled £68,212 (2021: £56,990) .

Certain Directors may become entitled to receive a share of the performance incentive fee related to the
Ordinary share pool as detailed in the Directors’ Remuneration Report on page 56 and in Note 5 .

The Company has no employees other than non-executive Directors . The average number of non-executive
Directors in the year was four (2021: four) .

5 . Performance Fees for Ordinary Shares

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

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

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

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

As a result of the reduction in the Accrued Performance Incentive Fee by one third, the amount of the Accrued
Performance Incentive Fee shall be 16 .67% of any dividends and capital distributions returned to shareholders,
which in total exceed the sum of 80p per Ordinary share (the “Hurdle”) . This includes dividends paid to date on
the Ordinary shares, being 71 .3p per share . As a result of this, for every £1 potentially distributable in excess of the
Hurdle, 80p shall be distributed to shareholders and 13 .33p shall be paid as the Accrued Performance Incentive
Fee, with 6 .67p (being one third of the original 20p) retainable by the Company up until an amount of 114 .65p per
Ordinary share has been distributed to Ordinary shareholders, after which no further payment is payable in respect
of the Accrued Performance Incentive Fee or otherwise under the terms of the 2007 Agreement (as amended) .
The Accrued Performance Incentive Fee shall be paid at the same time as payments are made to the Ordinary
shareholders . All distributions by way of dividends and capital distributions in relation to the Ordinary share class
shall count towards the Accrued Performance Incentive Fee and where non-cash dividends are declared, the
Company’s auditors shall assess their value by reference to a distribution per share . Following payment in full of
the Accrued Performance Incentive Fee, a further performance incentive fee may become payable to the CAC in
relation to the period after 7 October 2015 (the, “Further Performance Incentive Fee”) .

Following the amendment on 7 October 2015, any returns above the 31 December 2014 levels are subject to a
further hurdle (the “Further Hurdle”), and the Further Performance Incentive Fee reduces the share to the CAC to
10% of sums returned to Ordinary shareholders by way of dividends and capital distributions of whatever nature,
which in total exceed the Further Hurdle (excluding any initial tax relief on the subscription for the Ordinary
shares) . The “Base Figure” for the Further Hurdle shall be 90 .4p per Ordinary share and shall be increased by a
sum equal to notional interest thereon, at the rate of 1 .467% per quarter from 1 January 2015, compounded
with quarterly rests . For the purposes of determining the increase in the Base Figure, the amount on which
notional interest is to accrue in each quarter shall be reduced by the amount of all sums returned to Ordinary
shareholders by way of dividends and capital distributions in the previous quarter . Shareholders will need to
have received distributions of 114 .65p per Ordinary share, together with the amount to take account of notional
interest as calculated above, before any Further Performance Incentive Fee is payable .

As at 31 December 2022, the Total Gross Return in respect of the Ordinary shares is 112 .66p, and so 4 .35p per
Ordinary share, totalling £353,000 has been accrued as part of this liability (31 December 2021: 112 .47p, 4 .33p
and £351,000 respectively) The movement of £2,000 in the Accrued Performance Incentive Fee has been
recognised as capital expenditure in the Ordinary share income statement (2021: £158,000) .

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022

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Assuming no dividends are paid on the Ordinary shares in 2023, the Total Gross Return would need to exceed
173 .6p at 31 December 2023 before any Further Performance Incentive Fee could be due, and at that time, it
would be 10% of any dividends or capital distributions made above this threshold . If the Further Performance
Incentive Fee is not triggered (as it has not been in this financial year) the Further Hurdle, net of dividends paid,
increments by a compound annual growth rate of 6%, applied quarterly as described above .

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

6 . Tax on Ordinary Activities

The corporation tax charge for the year was £nil (2021: £nil) .

The tax charge is calculated on return on ordinary activities before taxation at the applicable rate of 19 .0% (2021:
19 .0%) .

Current Tax Reconciliation:

Return on Ordinary activities before tax

Current tax at 19% (2020: 19%)

Gains/losses not subject to tax

Performance fee accrual not tax deductible

Excess management expenses carried forward

Total current tax charge and tax on results of ordinary
activities

Year to
31 December 2022
£’000

Year to
31 December 2021
£’000

(2,749)

(522)

430

2,096

398

(501)

The company has excess management expenses of £3,763,000 (2021: £3,279,000) to carry forward to offset
against future taxable profits .

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

7 . Earnings per Share

The earnings per Ordinary share is based on 8,115,376 (31 December 2021: 8,115,376) shares, being the weighted
average number of Ordinary shares in issue during the year, and a return for the year totalling £13,000 (31
December 2021: (£1,029,000)) .

The earnings per B share is based on 16,694,546 (31 December 2021: 12,002,312 ) shares, being the weighted
average number of B shares in issue during the year, and a return for the year totalling £(2,762,000) (31
December 2021: (£1,067,000)) .

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

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022

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8 . Net Asset Value per Share

The calculation of NAV per Ordinary share as at 31 December 2022 is based on 8,115,376 Ordinary shares in
issue at that date (31 December 2021: 8,115,376) .

The calculation of NAV per B share as at 31 December 2022 is based on 18,749,559 B shares in issue at that date
(31 December 2021: 14,588,659) .

9 . Fixed Asset Investments

Ordinary Shares

Level 1:
AIM-quoted
investments
£’000

Level 3:
Unquoted
investments
£’000

Total
investments
£’000

Valuation and net book amount:

Book cost as at 1 January 2022

Cumulative revaluation

Valuation at 1 January 2022

Movement in the year:

Purchases at cost

Disposals – cost

Disposals – revaluation

Reclassification in year

Revaluation in year

Valuation at 31 December 2022

Book cost at 31 December 2022

Revaluation to 31 December 2022

Valuation at 31 December 2022

892

2,082

2,974

(60)

(135)

136

2,915

832

2,083

2,915

2,573

(2,335)

238

(179)

2,573

(2,514)

3,465

(253)

3,212

(60)

(135)

(43)

2,974

3,405

(431)

2,974

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022

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A
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A
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N

B Shares

Valuation and net book amount:

Book cost as at 1 January 2022

Cumulative revaluation

Valuation at 1 January 2022

Movement in the year:

Purchases at cost

Disposals – cost

Disposals – revaluation

Revaluation in year

Valuation at 31 December 2022

Book cost at 31 December 2022

Revaluation to 31 December 2022

Valuation at 31 December 2022

Level 1:
AIM-quoted
investments
£’000

Level 3:
Unquoted
investments
£’000

Total
investments
£’000

4,042

484

4,526

4,370

(729)

(31)

(2,576)

5,560

7,682

(2,122)

5,560

3,384

3,427

1,550

5,042

4,935

107

5,042

7,426

527

7,953

5,920

(729)

(31)

(2,511)

10,602

12,617

(2,015)

10,602

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

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

All investments are initially measured at their transaction price . Subsequently, at each reporting date, the
investments are valued at fair value through profit or loss, and all capital gains or losses on investments are so
measured . Unquoted fixed asset investments are valued at fair value in accordance with the IPEV guidelines .

The changes in fair value of such investments recognised in these Financial Statements are treated as unrealised
holding gains or losses .

Level 3 valuations include assumptions based on non-observable market data, such as discounts applied
either to reflect changes in fair value of financial assets held at the price of recent investment, or to adjust
revenue or earnings multiples . Of the Company’s Level 3 investments, 24% are held on a revenue multiple
basis (2021: 49% were held on that basis) and therefore have significant judgement applied to the valuation
inputs . Further, the exit equity waterfall structure as detailed in each investee company’s articles of association
is also included as a valuation input . Throughout this exercise, and in determining the value of the Company’s
equity investments where trading multiples are considered, multiples used are reviewed and compared to
industry peers, based on size, stage of development, revenue generation and growth rate, as well as their
wider strategy and market position . These multiples are calculated in the traditional manner, by dividing the
enterprise value of the comparable group by its revenue, EBITDA or earnings depending on what is the norm
in a particular sector driven by how acquisitions in that sector are typically valued . The trading multiple is then
adjusted for considerations such as illiquidity, marketability and other differences, advantages and disadvantages
between the portfolio company and the comparable public companies based on company specific facts and
circumstances .

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022

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

The valuations for Fabacus and SolasCure are based on the price of funds last raised and the valuation for Qudini
is based on the implied value of an offer to acquire the business . The valuations for Alderley Lighthouse Labs,
Geomiq Ltd and Convenient Collect Ltd (t/a Hubbox) are based on the price of the B share pool’s last investment
and are reviewed for change in fair value .

Similar valuation methodologies as highlighted above are also considered in assessing the fair value of the
Ordinary share pool’s unquoted investments .

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

FRS 102 requires the Directors to consider the impact of changing one or more of the assumptions used as
part of the valuation process to reasonable possible alternative assumptions . Each of the relevant unquoted
portfolio companies has been reviewed in order to identify the sensitivity of the valuation methodology to
using alternative assumptions . Where discounts have been applied (for example to revenue levels) alternatives
have been considered which still fall within the IPEV Guidelines . For each relevant unquoted investment, two
scenarios have been modelled: more prudent assumptions (downside case) and more optimistic assumptions
(upside case) . Using the upside alternative, the value of the unquoted investments could result in an increase in
valuation of the B share pool investments by £44k . Applying the downside alternative, the value of the unquoted
investments could result in a decrease in valuation of B share pool investments by £88k . The impact of the
downside sensitivity is more limited by the preferential positions in the equity distribution waterfalls of the B
share pool investee companies mentioned above .

10 . Debtors

Prepayments

11 . Creditors

Amounts falling due within one year:

Trade creditors

PAYE/NIC

Other creditors

Accruals

Total amounts falling due within one year

Amounts falling due after one year:

Accruals

Total amounts falling due after one year

31 December 2022
£’000

31 December 2021
£’000

31 December 2022
£’000

31 December 2021
£’000

140

168

353

132

165

351

The amount falling due after more than one year relates to the potential liability for a performance fee on the
Ordinary share portfolio . More details are in Note 5 .

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022

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12 . Share Capital

Allotted and fully paid up:

8,115,376 Ordinary shares of 1p
(2021: 8,115,376 shares of 1p)

18,749,559 B shares of 1p
(2021 : 14,588,659 shares of 1p)

31 December 2022
£’000

31 December 2021
£’000

188

269

146

227

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

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

The Company issued a total of 4,188,693 B shares at prices between 82 .6p to 102 .4p per B share during the year .
These were issued pursuant to the offer for subscription for B shares launched on 29 October 2021 and a further
offer for subscription for B shares launched on 26 August 2022 to raise, in aggregate, up to £10 million with an
over-allotment facility of up to a further £10 million (before issue costs) . The Company also bought back 27,793
B shares (equal to 0 .16% of the opening number of B shares in issue) at a price of 90 .4p per share .

The total net proceeds received for the shares issued in the year was £3,841k for the B share pool .

Share Rights

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

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

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

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

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022

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13 . Movement in Shareholders’ Funds

Shareholders’ funds at start of year

Return on ordinary activities after tax

Increase due to issue of B shares

Own shares purchased for cancellation

Dividend paid

Shareholders’ funds at end of year

Year to
31 December 2022
£’000

Year to
31 December 2021
£’000

17,763

(2,749)

3,841

(25)

(700)

18,130

10,770

2,096

5,624

(727)

17,763

The analysis of changes in equity by the various reserves are shown in the Statement of Changes in Equity on
page 72 .

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

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

Distributable reserves total £3,324,000 as at 31 December 2022 (2021: £6,525,000 ) and are represented by the
special distributable reserve, the capital reserve gains/(losses) on disposal and the revenue reserve, reduced by
positive holding reserves (if any) .

An interim capital dividend of 2 pence per Ordinary share for the year to 31 December 2022 was paid on 23
December 2022 .

An interim dividend of 1 .5 pence per B share for the year to 31 December 2022 was paid on 20 May 2022 . A second
interim dividend of 1 .5 pence per B share for the year to 31 December 2022 was paid on 16 December 2022 .

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022

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14 . Financial Instruments

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

Classification of financial instruments

The Company held the following categories of financial instruments, all of which are included in the balance
sheet at fair value, at 31 December 2022 and 31 December 2021:

31 December 2022
£’000

31 December 2021
£’000

Financial assets at fair value through profit or loss:

Fixed asset investments

Total

Financial assets measured at amortised cost:

Cash and cash equivalents

Total

Financial liabilities measured at amortised cost:

Creditors

Accruals

Performance fee

Total

13,576

5,065

140

353

521

11,165

7,105

132

351

516

Fixed asset investments (see Note 9) are valued at fair value . Unquoted investments are carried at fair value as
determined by the Directors in accordance with the IPEV guidelines . The fair value of all other financial assets
and liabilities is represented by their carrying value in the balance sheet . The Directors believe that the fair value
of the assets held at the year-end is equal to their book value .

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

The Company’s Ordinary share pool provided an indemnity to the Royal Bank of Scotland (“RBS”) in 2013 of
£250,000 in relation to the registration of its shareholding in Omega Diagnostics Group Plc (“Omega”) . The
investment in Omega was made in 2007 and was fully exited in September 2020 . The Board has not recognised
any liability in relation to this historic indemnity as at 31 December 2022 and is liaising with RBS regarding the
formal release of the indemnity .

15 . Financial Risk Management

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

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022

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Market risk

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

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

28 .1% (2021: 20 .6%) by value of the Company’s net assets comprise investments in unquoted companies held at
fair value . The valuation methods used by the Company include the application of a price/earnings ratio derived
from listed companies with similar characteristics, and consequently the value of the unquoted element of the
portfolio can be indirectly affected by price movements on the London Stock Exchange . A 10% overall increase
in the valuation of the unquoted investments at 31 December 2022 would have increased net assets and the
total return for the year by £510,000 (2021: £367,000) disregarding the impact of the performance fee; an
equivalent change in the opposite direction would have reduced net assets and the total return for the year by
the same amount .

46 .7% (2021: 42 .2%) by value of the Company’s net assets comprises equity securities quoted on AIM . A 10%
increase in the bid price of these securities as at 31 December 2022 would have increased net assets and the
total return for the year by £848,000 (2021: £750,000) disregarding the impact of the performance fee; a
corresponding fall would have reduced net assets and the total return for the year by the same amount .

Credit risk

There were no significant concentrations of credit risk to counterparties at 31 December 2022 or 31 December
2021 .

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

Liquidity risk

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

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

16 . Events After the Balance Sheet Date

The Company successfully exited B share portfolio unquoted investee company Qudini Ltd in January 2023 .
This was the result of the sale of the company to US software business Verint Systems, a leader in workforce
engagement management . The consideration comprised an upfront payment equal to the B share pool’s initial
investment and the potential to receive up to a further 0 .44x of the initial investment subject to Qudini’s trading
performance in the three years following the sale .

In March 2023, the Company invested £376k from the B share pool into AIM quoted Engage XR . Engage XR is
a business-focused metaverse platform designed for corporations, professionals, education organisations and
event organisers to create their own virtual worlds, provide services directly to their clients and allow them to
engage with employees, customers and suppliers .

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022

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The Company declared an interim B share dividend of 1 .5p per B share and an interim Ordinary share capital
dividend of 2p per Ordinary share on 7 March 2023 to be paid on 19 May 2023 to shareholders on the share
register on 5 May 2023, with an ex-dividend date of 4 May 2023 .

On 21 February 2023, Ten80 Group Ltd . was put into liquidation; however, this has not had any impact on the B
share NAV as it was already held at £nil value in the B share portfolio .

On 4 April 2023, the Company announced a new NAV per B share of 73 .8p as at 31 March 2023 . This decrease
in NAV per B share was predominantly as a result of a reduction in the share prices of some of the B share pool’s
AIM quoted investments .

As at 31 March 2023, shares in Scancell were valued at 15 .5p per share (31 December 2022: 24p) and shares
in Arecor were valued at 250p per share (31 December 2022: 230p) . As a result, on 4 April 2023 the Company
announced an updated unaudited NAV per Ordinary share of 28 .4p as at 31 March 2023 .

On 5 April 2023 the Company issued 1,233,811 B shares, bringing the total issued share capital of the Company
to 28,098,746 shares .

The B share pool also completed a follow-on investment of £500k into Old Street Labs Limited (t/a Vizibl) in
April 2023 .

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

17 . Contingencies, Guarantees and Financial Commitments

There were no contingencies, guarantees or financial commitments as at 31 December 2022 (2021: £nil) .

18 . Related Party Transactions

The Board acted as the investment manager of the Company until Seneca was appointed on 23 August 2018 .
Certain Directors are entitled to participate in a performance bonus as detailed in Note 5 . During the year,
Seneca has earnt £303,000 in management fees (2% of the weighted average net assets of the B share portfolio)
(2021: £246,000) . However, only £285,000 (2021: £211,000) is recoverable by Seneca as a result of the cost
cap, as detailed in Note 2 of which £72,000 remained unpaid as at 31 December 2022 and has therefore been
included in accruals (2021: £76,000) .

Seneca as Investment Manager accrued £106,000 (2021: £74,193) transaction fees and directors’ fees from
investee companies in relation to the arrangement and monitoring of investments . As a related party, we believe
that this transaction is disclosable, and the Board ensures it is managed from a conflicts of interest point of
view . Seneca may also become entitled to a performance fee . See Note 2 to the financial statements for more
information on these fees .

As detailed in the offer for subscription document dated 29 October 2021 and the subsequent offer for
subscription document dated 26 August 2022, Seneca (as promoters of the Offer) is entitled to charge the
Company up to 5 .5% of investors’ subscriptions . A total of £23,049 has been paid to Seneca for the year ended
31 December 2022 (2021: £35,278) . Richard Manley’s Director’s fee of £15,000 was taken for the 2022 financial
year as payment to the Investment Manager as detailed in the Directors’ Remuneration Report and Policy on
pages 54 to 57 (2021: £3,750) .

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022

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Shareholder Information and
Contact Details

Dividends

Dividends will be paid by the Registrar on behalf of the Company . Shareholders who wish to have dividends paid
directly into their bank account rather than by cheque to their registered address should contact the Company’s
Registrar, Neville, whose details can be found on page 95 . Other queries relating to dividends and shareholdings
should also be directed to Neville .

Share Price

The share price of both the Company’s Ordinary shares and B shares are published daily on the London Stock
Exchange’s website (www .londonstockexchange .com), and other financial websites, and can also be accessed
through the Company’s website (www .senecavct .co .uk) . The Ordinary share price may be found using the TIDM/
EPIC code HYG, and the B share price may be found using the TIDM/EPIC code SVCT .

Latest mid-market share price (19 April 2023)

20 .50p per share

70 .00p per share

Ordinary shares

B shares

Buying and Selling Shares

The Company’s Ordinary and B shares, which are listed on the London Stock Exchange, can be bought and sold
in the same way as any other company quoted on a recognised stock exchange via a stockbroker . There may
be tax implications in respect of all or part of your holdings, so shareholders should contact their independent
financial adviser if they have any queries .

The Company does not currently operate a share buyback policy for its Ordinary shares, but is authorised to buy
back its B shares (within approved limits) . If you are considering selling your shares or trading in the secondary
market, please contact the Company’s Corporate Broker, Panmure Gordon (UK) Limited as follows:

Chris Lloyd
Paul Nolan

020 7886 2716 chris .lloyd@panmure .com
020 7886 2717 paul .nolan@panmure .com

Risk Warning - Financial Scams

We have been made aware that a number of existing shareholders and those of other VCTs have been contacted
in connection with fraudulent financial scams . In these instances, shareholders have received unsolicited phone
calls from persons claiming to work for a corporate finance firm, offering to buy shareholder’s VCT shares at
an inflated price in connection with a possible take-over of the VCT and asking shareholders to sign a non-
disclosure agreement .

The claims made are false and are invariably an attempt to obtain confidential personal information from
shareholders with a view to fraudulently extract money from them .

Shareholders are warned to be very suspicious if they receive any similar type of communication and we would
recommend that you do not respond with any personal information .

If you are in any doubt, we recommend that you seek professional financial advice before taking any action .
You can also call Seneca Partners Limited on 01942 295 981 if you wish to check that any correspondence or
communication you receive from the Company is genuine .

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022

Notification of change of address

Communications with shareholders are mailed to the registered address held on the share register unless
shareholders have agreed to be contacted via e-mail . In the event of a change of address or other amendment
this should be notified to Neville Registrars, under the signature of the registered holder .

Other information for Shareholders

Previously published Annual Reports and Half-yearly Reports are available for viewing on the Company’s website
at www .senecavct .co .uk, and in line with current trends all future communications will also be made available
there . The Company has introduced e-communication for its shareholders and in line with these objectives,
the Company will not be printing the Half-yearly Reports in the future but will instead provide an electronic
version made available on the Company’s website www .senecavct .co .uk . We continue to encourage all of our
investors to switch to receiving updates from the Company via e-mail and documents in soft copy . This enables
you to receive documents more quickly and has the added benefits of being more environmentally friendly and
reducing printing and postage costs .

Should you wish to switch to e-mail communication and documents in the future by e-mail, please contact
our Registrars, Neville Registrars Limited, Neville House, Steelpark Road, Halesowen, B62 8HD, e-mail info@
nevilleregistrars .co .uk, or phone 0121 585 1131 . Please also contact them for any other queries related to your
shareholding in the Company .

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Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022

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Directors and Advisers

Board of Directors

Company Number

Secretary and Registered Office

Investment Manager and Administration Manager

Corporate Broker

Sponsor

Solicitors

Independent Auditor

VCT Tax Adviser

Bankers

Registrars

Depositary

John Hustler (Chair)
Alex Clarkson
Richard Manley
Richard Roth

Registered in England & Wales
No 04221489

ISCA Administration Services Limited
9 The Parks
Haydock WA12 0JQ

Seneca Partners Limited
9 The Parks
Haydock WA12 0JQ
Tel: 01942 271746

Panmure Gordon (UK) Limited
One New Change
London EC4M 9AF
Tel: 020 7886 2500

SPARK Advisory Partners Limited
5 St . John’s Lane
London EC1M 4BH

Hill Dickinson LLP
50 Fountain Street
Manchester M2 2AS

Hazlewoods LLP
Staverton Court
Staverton
Cheltenham GL51 0UX

Shoosmiths LLP
No . 1 Bow Churchyard
London EC4M 9DQA

The Royal Bank of Scotland plc
62/63 Threadneedle Street
London EC2R 8LA

Neville Registrars Limited
Neville House
Steelpark Road
Halesowen B62 8HD
Tel: 0121 585 1131

Thompson Taraz Depositary Limited
47 Park Lane
London W1K 1PR

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022

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Notice of Annual General Meeting

The Company’s Annual General Meeting (“AGM”) will be held at 11:00 a .m . on Thursday, 18 May 2023 at the
Company’s registered address 9 The Parks, Haydock, WA12 0JQ .

For any shareholders wishing to attend the AGM this year in person, we request that you please inform us in
advance by e-mailing enquiries@senecavct .co .uk so that we may register your attendance with the facilities
manager in order to issue you with the appropriate attendance pass . For those unable to attend, we will be
hosting our bi-annual shareholder update presentation with a question and answer (Q&A) session included,
starting at 2:00 p .m . on 10 May 2023 . Shareholders should note that only the formal business set out in the
notice of AGM will be considered at the AGM and we encourage shareholders to attend the presentation and
ask questions prior to the AGM . Further details about the shareholder update presentation can be found on the
Company’s website at www .senecavct .co .uk/may-2023-shareholder-presentation .

We strongly encourage shareholders to vote on the matters of business through the completion of a proxy
form, which can be submitted to the Company’s Registrar . Proxy forms should be completed and returned in
accordance with the instructions thereon and the latest time for the receipt of proxy forms is 11:00 a .m . on 16
May 2023 . Proxy votes can also be submitted by CREST where shares are so held .

Richard Roth has informed the Board that he will not be seeking re-election and will therefore retire from the
Board at the conclusion of the meeting .

Resolutions 1 to 7 (inclusive) will be proposed as Ordinary Resolutions and resolutions 8 to 11 (inclusive) will be
proposed as Special Resolutions .

Ordinary Business

To consider and if thought fit, pass the following as Ordinary Resolutions:

1 . THAT the Directors’ Annual Report and Financial Statements and the auditors’ report thereon for the year

ended 31 December 2022 be received .

2 . THAT the Directors’ Remuneration Report in respect of the year ended 31 December 2022 (as set out in the

Annual Report and Financial Statements for the same) be approved .

3 . THAT John Hustler be re-elected as a Director of the Company .
4 . THAT Richard Manley be re-elected as a Director of the Company .
5 . THAT Alex Clarkson be re-elected as a Director of the Company .

Biographical details for each Director and their individual contributions to the Company towards its long-term
sustainable success can be found on page 40 of the Annual Report .

6 . THAT Hazlewoods LLP be re-appointed as auditor of the Company until the conclusion of the next Annual

General Meeting of the Company at which accounts are laid before the shareholders and THAT the
Directors be authorised to determine their remuneration .

Special Business

To consider and if thought fit, pass the following as an Ordinary Resolution:

7 . AUTHORITY TO ALLOT RELEVANT SECURITIES

THAT, in addition to existing authorities, the Directors be and are hereby generally and unconditionally
authorised in accordance with section 551 of the Companies Act 2006 (the “Act”) to exercise all the powers
of the Company to allot:

1 . B ordinary shares of 1p each in the capital of Company (“B shares”) up to an aggregate nominal amount

of £350,000 in connection with offer(s) for subscription;

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022

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2 . B shares for cash and otherwise than pursuant to sub-paragraph 1 . above, up to an aggregate nominal

amount of £100,000; and

3 . ordinary shares of 1p each in the capital of Company (“Ordinary Shares”) for cash, up to an aggregate

nominal amount of £4,058

provided that this authority shall expire at the later of the conclusion of the Company’s next Annual General
Meeting following the passing of this resolution and the expiry of 15 months from the passing of this resolution
(unless previously revoked, varied or extended by the Company in a general meeting) but so that such authority
shall allow the Company to make offers or agreements before the expiry thereof which would or might require
relevant securities to be allotted after the expiry of such authority and the Directors shall be entitled to allot
shares pursuant to any such offers or agreements as if the authority conferred by this resolution had not expired .

To consider and if thought fit, pass the following as a Special Resolution:

8 . AUTHORITY TO PURCHASE RELEVANT SECURITIES

THAT the Company be and is hereby generally and unconditionally authorised within the meaning of
section 701 of the Act to make one or more market purchases (within the meaning of section 693(4) of the
Act) of B shares provided that:

1 .

2 .
3 .

4 .

5 .

the maximum number of B shares hereby authorised to be purchased is an amount equal to 14 .99% of
the issued B share capital of the Company from time to time;
the minimum price which may be paid for a B share is 1 pence per share, the nominal amount thereof;
the maximum price which may be paid for a B share is an amount equal to the higher of:
1 .

105% of the average of the middle market prices shown in the quotations for a B share in The
London Stock Exchange Daily Official List for the five business days immediately preceding the
day on which that share is purchased; and
the amount stipulated by Article 5(6) of Market Abuse Regulation (596/2014/EU) (as it forms part
of UK law by virtue of the European Union (Withdrawal) Act 2018);

2 .

the authority hereby conferred shall (unless previously renewed or revoked) expire on the earlier of the
conclusion of the Company’s next Annual General Meeting following the passing of this resolution and
the date which is 15 months after the date on which this resolution is passed; and
the Company may make a contract or contracts to purchase its own B shares under this authority
before the expiry of the authority which will or may be executed wholly or partly after the expiry of the
authority, and may make a purchase of its own B shares in pursuance of any such contract or contracts
as if the authority conferred hereby had not expired .

To consider and, if thought fit, pass the following as a Special Resolution:

9 . EMPOWERMENT TO MAKE ALLOTMENTS OF EQUITY SECURITIES

THAT, in addition to existing authorities, the Directors pursuant to section 570(1) of the Act be and are
hereby empowered to allot or make offers or agreements to allot equity securities (as defined in section
560(1) of the Act) for cash pursuant to the authority referred to in Resolution 7 as if section 561(1) of the Act
did not apply to any such allotments and so that:

1 .

2 .

reference to allotment in this resolution shall be construed in accordance with section 560(2) of the
Act; and
the power conferred by this resolution shall enable the Company to make any offer or agreement
before the expiry of the said power which would or might require equity securities to be allotted after
the expiry of the said power and the Directors may allot equity securities in pursuance of such offer or
agreement notwithstanding the expiry of such power,

and this power, unless previously varied, revoked or renewed, shall come to an end at the conclusion of the
Annual General Meeting of the Company next following the passing of this resolution or, if earlier, on the expiry
of 15 months from the passing of this resolution .

Seneca Growth Capital VCT Plc Annual Report & Financial Statements for the year ended 31 December 2022

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To consider and, if thought fit, pass the following as a Special Resolution:

10 . CANCELLATION OF THE SHARE PREMIUM ACCOUNT

THAT, the amounts standing to the credit of the share premium account of the Company and the capital
redemption reserve of the Company, as at the date an order is made confirming such cancellation by the
Court, be and is hereby cancelled .

To consider and, if thought fit, pass the following as a Special Resolution:

11 . ALTERATION TO THE ARTICLES OF ASSOCIATION

THAT with effect from the conclusion of the meeting the draft articles of association produced to the
meeting and, for the purposes of identification, initialled by the Chair be amended in paragraph 102, line 2
by replacing “£100,000” with “£150,000” in respect of the maximum aggregate fees payable to Directors per
annum and adopted as the Articles of Association of the Company in substitution for, and to the exclusion
of, the Company’s existing Articles of Association .

By order of the Board
ISCA Administration Services Limited
Company Secretary
20 April 2023

Registered Office:
9 The Parks
Haydock
WA12 0JQ

Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022

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Notes

i .

Pursuant to Regulation 41 of the Uncertificated Securities Regulations 2001, entitlement to attend and vote
at the meeting (and the number of votes that may be cast thereat), will be determined by reference to the
Register of Members of the Company at the close of business on the day which is two days before the day
of the meeting or of the adjourned meeting . Changes to the Register of Members of the Company after
the relevant deadline shall be disregarded in determining the rights of any person to attend and vote at the
meeting .

ii . A member entitled to attend and vote at the meeting is entitled to appoint a proxy or proxies to attend,
speak and vote on his or her behalf . A proxy need not also be a member but must attend the meeting to
represent the appointer . Details of how to appoint the chair of the meeting or another person as a proxy
using the Form of Proxy are set out in the notes on the Form of Proxy . If the member wishes his or her proxy
to speak on their behalf at the meeting then the member will need to appoint their own choice of proxy (not
the chair) and give their instructions directly to the proxy .

iii . A member may appoint more than one proxy provided each proxy is appointed to exercise rights attached
to different shares . A member may not appoint more than one proxy to exercise rights attached to any one
share . To appoint more than one proxy, a member may copy the proxy form, clearly stating on each copy
the shares to which the proxy relates, or alternatively contact the Company’s registrars, Neville Registrars
Limited, on 0121 858 1131 to request additional copies of the proxy form . For legal reasons Neville Registrars
Limited will be unable to give advice on the merits of the proposals or provide financial, legal, tax or
investment advice . The member will need to indicate in the box next to the proxy holder’s name the number
of shares in relation to which they are authorised to act as proxy, and will also need to indicate on the form
(by ticking the box provided) if the proxy instruction is one of multiple instructions being given . All forms
must be signed and returned together in the same envelope .

iv . Any person to whom this notice is sent who is a person nominated under section 146 of the Act to enjoy

information rights (a “Nominated Person”) may, under an agreement between him/her and the member by
whom he/she was nominated, have a right to be appointed (or to have someone else appointed) as a proxy
for the meeting . If a Nominated Person has no such proxy appointment right or does not wish to exercise
it, he/she may, under any such agreement, have a right to give instructions to the shareholder as to the
exercise of voting rights .

v . The statement of the rights of members in relation to the appointment of proxies in paragraphs (ii) to (iii)

above does not apply to Nominated Persons . The rights described in these paragraphs can only be exercised
by members of the Company .

vi .

If the recipient of this document has been nominated to receive general shareholder communications
directly from the Company, it is important to remember that the member’s main contact in terms of their
investment remains as it was (being the registered shareholder, or perhaps custodian or broker, who
administers the investment on their behalf) . Therefore, any changes or queries relating to a member’s
personal details and holding (including any administration thereof) must continue to be directed to that
member’s existing contact at their investment manager or custodian . The Company cannot guarantee that
it will deal with any matters that are directed to it in error . The only exception to this is where the Company,
in exercising one of its powers under the Act, writes to a member directly for a response .

vii . CREST members who wish to appoint a proxy or proxies by utilising the CREST electronic proxy

appointment service may do so for the AGM and any adjournment(s) of it by using the procedures described
in the CREST Manual (available from https://www .euroclear .com/site/public/EUI) . CREST Personal
Members or other CREST sponsored members, and those CREST members who have appointed a voting
service provider(s), should refer to their CREST sponsor or voting service provider(s), who will be able to
take the appropriate action on their behalf . In order for a proxy appointment made by means of CREST to
be valid, the appropriate CREST message (a CREST Proxy Instruction) must be properly authenticated in
accordance with Euroclear UK & Ireland Limited’s (EUI) specifications and must contain the information
required for such instructions, as described in the CREST Manual . The message must be transmitted so as
to be received by the issuer’s agent (CREST ID 7RA11) by 11:00 a .m . on 16 May 2023 . For this purpose, the
time of receipt will be taken to be the time (as determined by the timestamp applied to the message by
the CREST Applications Host) from which the issuer’s agent is able to retrieve the message by enquiry to
CREST in the manner prescribed by CREST . CREST members and, where applicable, their CREST sponsors or
voting service providers should note that EUI does not make available special procedures in CREST for any
particular messages . Normal system timings and limitations will therefore apply in relation to the input of
CREST Proxy Instructions . It is the responsibility of the CREST member concerned to take (or, if the CREST
member is a CREST personal member or sponsored member or has appointed a voting service provider(s),
to procure that his CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary
to ensure that a message is transmitted by means of the CREST system by any particular time . In this

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connection, CREST members and, where applicable, their CREST sponsors or voting service providers are
referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST
system and timings . The Company may treat as invalid a CREST Proxy Instruction in the circumstances set
out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001 .

viii . A reply-paid Form of Proxy or a reply-paid envelope is enclosed with this document if received by post .

To be valid, the enclosed Form of Proxy for the meeting, together with the power of attorney or other
authority, if any, under which it is signed or a notarially certified or office copy thereof, must be deposited at
the offices of the Company’s registrar, Neville Registrars Limited, Neville House, Steelpark Road, Halesowen
B62 8HD to be received not later than 11:00 a .m . on 16 May 2023 or 48 hours before the time appointed for
any adjourned meeting or, in the case of a poll taken subsequent to the date of the meeting or adjourned
meeting, so as to be received no later than 24 hours before the time appointed for taking the poll .

ix . Appointment of a proxy will not preclude a member from subsequently attending and voting at the meeting
should he or she subsequently decide to do so . A member can only appoint a proxy using the procedure set
out in these notes and the notes to the Form of Proxy .

x . As at 19 April 2023 (being the last business day prior to the publication of this notice), the Company’s issued
share capital comprised 8,115,376 Ordinary shares and 19,983,370 B shares, all of which carry one vote
each . Therefore, the total voting rights in the Company as at 19 April 2023 was 28,098,746 .

xi . Copies of the Directors’ letters of appointment, the Register of Directors’ Interests in shares of the Company
and copies of the Articles of Association of the Company will be available for inspection at the registered
office of the Company during usual business hours on any weekday (Saturday and Public Holidays excluded)
from the date of this notice, until the end of the Annual General Meeting and at the place of the Annual
General Meeting for at least 15 minutes prior to and during the meeting .

xii . If a corporate shareholder has appointed a corporate representative, the corporate representative will have
the same powers as the corporation could exercise if it were an individual member of the Company . If more
than one corporate representative has been appointed, on a vote on a show of hands on a resolution, each
representative will have the same voting rights as the corporation would be entitled to . If more than one
authorised person seeks to exercise a power in respect of the same shares, if they purport to exercise the
power in the same way, the power is treated as exercised; if they do not purport to exercise the power in the
same way, the power is treated as not exercised .

xiii . At the meeting, shareholders have the right to ask questions relating to the business of the meeting and
the Company is obliged under section 319A of the Act to answer such questions, unless: to do so would
interfere unduly with the preparation of the meeting or would involve the disclosure of confidential
information, if the information has been given on the Company’s website: www .senecavct .co .uk in the form
of an answer to a question, or if it is undesirable in the interests of the Company or the good order of the
meeting that the question be answered .

xiv . Further information, including the information required by section 311A of the Act, regarding the meeting is

available on the Company’s website, www .senecavct .co .uk .

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Seneca Growth Capital VCT PlcAnnual Report & Financial Statements for the year ended 31 December 2022

Seneca Growth Capital VCT Plc
9 The Parks, Haydock, WA12 0JQ