HG Capital Trust PLC - Final Results - Part 1

Tue Mar 18, 2008 3:02am EDT

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RNS Number:3144Q
HG Capital Trust PLC
18 March 2008


                              HgCapital Trust plc

            Preliminary Results for the year ended 31 December 2007

London, 18 March 2007: HgCapital Trust plc (or "the Trust"), the Private Equity
Investment Trust managed by HgCapital, the European sector-focused private
equity investor, today announces preliminary results for the 12 months ended 31
December 2007.

Financial highlights

•  Total return (NAV plus dividend) increased by 30%.

•  One year total return share price performance of 8% against FTSE All-share 
   of 5%.

•  Ten year total return of 18% per annum versus 6% per annum from the FTSE 
   All-Share Index.

•  NAV increased by 28% to £238.8 million (2006: £187.1 million).

•  An investment of £1,000 ten years ago, with dividends reinvested, would now 
   be worth £5,183 based on the Company's share price at 31 December 2007 
   compared with £1,824 for the FTSE All-Share Index.

•  Dividend of 25p per share (2006: 14p per share).

•  The NAV per share at 31 January 2008 was 979.5p and at 29 February 2008 it 
   was 1,002.1p.

Operational Highlights

•  Another record year for realisations with proceeds of £106.3 million 
   (2006: £62.3 million), principally from the sale of Schenck, Hirschmann
   and the combined sale of IRIS Software and CS Group.

•  European focus and sector expertise resulted in investing a record 
   £50.8 million (2006: £45.3 million) in eight new investments including
   Fabory (Netherlands, €345 million EV), Mondo Minerals (Finland, €230 million
   EV), SLV (Germany, €320 million EV) and Americana (UK, £186 million EV).

•  The Trust won the private equity investment trust of the year for an 
   unprecedented third consecutive year at the Investment Week Awards,
   again demonstrating the consistent strong performance of the company.

•  A further €3.5 million out of its €21 million commitment invested in the 
   €300 million Hg Renewable Power Partners fund.

•  Since the year-end, one new investment made in Casa Reha (Germany, 
   €327 million EV) and three realisations with the sales of Hofmann Menu, 
   The Sanctuary Spa and Clarion Events.

Roger Mountford, the Chairman, commented:

"In 2007, we saw the beginning of the credit crisis, which has had a severe
impact on the financial services industry. Despite this, the Trust has continued
to perform well, thanks to the Manager's mid market focus and ability to create
strong returns across all market cycles. It is this strength that allows us to
remain confident about the outlook for the Trust in 2008. The asset class
retains its attractive long-term prospects for growth."


For further details:

HgCapital
Ian Armitage                     +44 (0)20 7089 7888

Maitland
Peter Ogden                      +44 (0)20 7379 5151


About HgCapital

HgCapital is a sector focused private equity investor in the European
mid-market. We focus on investments with an enterprise value in the range of
£50-£500 million. Our business model combines sector specialisation with
dedicated, pro-active support to our portfolio companies as well as the
corresponding management expertise across all phases of the investment process.
HgCapital manages more than €2.3 billion for some of the world's leading
institutional and private investors. Our goal is to achieve outstanding results
for our investors, management team and intermediaries.

For further details, see www.hgcapital.com


HgCapital Trust plc

Private equity investment trust of the year
Investment Week Awards 2005, 2006 & 2007

Annual report and accounts
31 December 2007

Contents

Investment objective
Financial highlights
Chairman's statement
Ten year track record
Investing in private equity
Manager's strategy
Manager's review
Investments
Realisations
Review of principal investments
Renewable energy
Investment portfolio

Income statement
Balance sheet
Cash flow statement
Reconciliation of movements in shareholders' funds
Notes to the financial statements

Top ten investments
Analysis of registered shareholders

Board of Directors
Directors' report and business review (including investment policy)
Directors' remuneration report
Corporate governance and Directors' responsibilities
Report of the independent auditor
Shareholder information
Glossary
Notice of Annual General Meeting
Management and administration

Investment objective

The objective of the Company is to provide shareholders with long-term capital
appreciation in excess of the FTSE All-Share Index by investing in unquoted
companies.

The Company provides investors with exposure to a diversified portfolio of
private equity investments primarily in the UK and Continental Europe.

Financial highlights

+30% Strong growth in net assets (including dividend)

+8% Share price and dividend (total return) versus the FTSE All-Share Index
total return of 5%

+18% Ten year total return per annum versus 6% per annum from the FTSE All-Share
Index

>5x Growth in value of shares over 10 years

£106m Another record year for realisations

£51m Record year for new investments, which deep sector knowledge helped us to
identify

25p Dividend per share declared on 17 March 2008

The NAV per share at 31 January 2008 was 979.5p and at 29 February 2008 it was
1002.1p.

Chairman's statement

The Board believes the Company is well placed to continue growing while taking
advantage of improved market conditions for the acquisition of good businesses
at reasonable prices

Performance

I am pleased to report that over the year to 31 December 2007 the Company again
created value for shareholders through strong growth in net asset value. The
total return (NAV plus dividend) was 30.0%, which compares well against the
total return of 5.3% of the FTSE All-Share Index and a decrease of 10.5% in the
FTSE Small-Cap Index. The Company's net asset value at year-end was 948.2 pence
per share. Two successful realisations that completed shortly after the
year-end, The Sanctuary and Clarion Events, have added 47 pence per share. The
NAV per share at the end of February was 1,002.1 pence.

The Company's long-term returns to shareholders continue to be strong, with a
total return (share price plus dividend) over the last ten years of 17.9% p.a.,
some 11.7% p.a. above the total return on the FTSE All-Share Index. The strong
long-term performance delivered by HgCapital as Manager was recognised when the
Company was chosen, for the third consecutive year, as Private Equity Investment
Trust of the Year in the Investment Week awards. We congratulate the Manager and
its staff for their hard and dedicated work in achieving this consistently high
level of performance.

During the year, the Company received £106.4 million from the realisation of
investments (2006: £62.3 million) and invested £50.8 million (2006: £45.3
million) in new and follow-on investments. Both are new records.

The Company's share price at the end of the year was 775.0 pence, an increase of
6% over the year. Total return (share price growth plus dividend) was 8%, which
also represented a substantial out-performance of the relevant FTSE indices
despite the trend of widening discounts against NAV that was observed across the
whole sector of private equity investment trusts and investment trusts in
general. At year-end the market capitalisation of the Company had grown to £195
million.

Revenue return was 29.6 pence per share, compared with 17.9 pence in the
previous year. The Company's revenue varies from year to year in accordance with
the structure of the underlying investments and the Company's holding of liquid
funds available for reinvestment. Each year the Board recommends a dividend
based on the revenue return that year, to maintain its status as an investment
trust; this year the Board recommends a final dividend of 25.0 pence per share
(2006: 14.0 pence).

Performance record

Year ended 31 December                 

           Net assets  Net aseet                          Revenue  Earnings  Dividends
         attributable  value per  Ordinary              available       per        per
          to ordinary   ordinary     share    Gross  for ordinary  ordinary   ordinary
         shareholders      share     price  revenue  shareholders     share      share
                £'000         p          p    £'000         £'000         p         p

1998           66,851      257.8     208.0    2,495         1,359       5.2       4.95
1999           89,863      346.5     289.0    3,901         2,481       9.6       8.00
2000          103,521      411.0     356.5    7,332         4,623      17.9      14.50
2001           95,795      380.3     294.0    3,893         2,420       9.6       8.00
2002           83,837      332.9     219.5    3,528         2,148       8.5       8.00
2003           99,987      397.0     289.5    7,106         3,969      15.8        -**
2004          122,040      484.5     451.5    4,905         2,649      10.5      12.00
2005          156,487      621.3     583.5    4,963         2,965      11.8       8.00
2006          187,135      743.0     731.0    7,769         4,519      17.9      10.00
2007          238,817      948.2     775.0   12,129         7,446      29.6      14.00*

*  Final dividend for the year ended 31 December 2006, declared on 23 March 2007,
   paid on 1 May 2007.
** Change in accounting standards relating to recognition of dividends

Realisations

Our Manager made six major realisations during the year: Doc Morris, Hirschmann
Electronics, IRIS and CS Group in the first half and Schenck and Hofmann Menu
(cash received in early January 2008) in the second half. The process of selling
The Sanctuary and Clarion Events began before year-end and these sales were
completed in January and February respectively. All of these realisations have
been achieved for proceeds above the values at which they were held in the
Company's balance sheet. Brief descriptions of these investments can be found in
the Manager's review.

As I noted in the Interim statement, in current market conditions, value
creation will rely all the more on organic growth and margin enhancement, rather
than on arbitrage between entry and exit multiples. The Board is reassured that
HgCapital's investment style, which has always been to take a controlling
position and then work actively with management to define and deliver strategies
that add value to the underlying business, is well suited to more uncertain
times.

Investments

The first half of the year, during most of which equity markets were at peak
levels, did not provide good conditions for acquiring sound businesses at
reasonable prices. Some owners of businesses are only adjusting their
expectations slowly to changed market conditions; however, HgCapital has
completed a number of suitable acquisitions in the second half, especially in
Continental Europe, leading to an increased rate of investment. £23.8 million
has been invested by the Company in three businesses in Continental Europe
alongside the Manager's Hg5 fund. As I have reported before, the Manager has
continued to seek buyout and development capital opportunities that fall outside
the investment parameters of Hg5 but which offer the Company attractive returns
through co-investment with other clients of HgCapital. £12.4m has been invested
in two UK businesses that offer potential for successful roll-out, alongside
other investors including (on the same terms as the Company) some members of the
Manager's staff. Further information on all new investments can be found in the
Manager's report and on the Company's web-site at www.hgcapitaltrust.com.

The Company's portfolio is well diversified, both geographically and by sector.
The portfolio contains a wide range of businesses with potential for organic
growth and value creation over coming years: following recent realisations, 74%
by value of the portfolio (excluding liquid funds) is in investments acquired in
the last three years and 48% is still valued by the Board at cost.

With £79.8 million in liquid funds at year-end available for reinvestment and a
£25 million borrowing facility, the Company is well positioned to take up
opportunities to invest on attractive terms.

Board and AGM

In last year's report the Board stated that as part of its long-term succession
planning it intended to identify an additional Director. After a formal process
in which the Board employed a specialist recruitment agency we invited Richard
Brooman to join the Board. He is a chartered accountant with long experience as
a finance director and on the board of another investment trust. Mr Brooman has
been appointed chairman of the Company's Audit and Valuation Committee with
effect from 1 July 2008, in succession to Tim Amies who has made a huge
contribution to the Company's progress through his leadership of the Committee.
Mr Brooman's election as a Director of the Company will be proposed at this
year's AGM.

The Board will also ask shareholders to renew the power to purchase shares in
the market for cancellation, which the Board may use to return capital to
shareholders if conditions for new investment are unfavourable and the Company
appears to have surplus capital. Resolutions will also be proposed to amend the
Articles to take account of those provisions of the Companies Act 2006 that are
coming into effect, and to increase the total available for payment of
directors' fees, to take account of increases in fees and the enlargement of the
Board.

Walker Report

It has been the Board's consistent policy to publish reports that are
transparent and comprehensive in describing the portfolio, the sources of value
creation and risk. In November 2007 Sir David Walker published his report
"Guidelines for Disclosure and Transparency in Private Equity", which sets out
guidelines regarding the disclosure of information by private equity companies
and their UK portfolio companies.The Board welcomes this report. The Manager's
review details the relationship between the Company and the Manager, the firm's
history and investment approach, strategy and tactics. The Investment pages
describe the history of the Manager's involvement with its portfolio companies
and gives details of their financial performance and any key factors that impact
this.

Prospects

The market for debt in very large leveraged buyouts is undoubtedly very
difficult; however, for the mid-market buyouts in which HgCapital specialises,
large amounts of debt requiring wide syndication or refinancing in public
markets are typically not necessary. With strong liquidity, HgCapital has the
flexibility to underwrite acquisitions with more equity than before and
refinance with debt at a later date. Future deals may include more
mezzanine-level funding which, until recently, had been largely squeezed out by
easy bank lending. While these factors may serve to restrain prices paid for
businesses, they do not appear to be preventing deals from being completed in
the mid-market sector.

The private equity business finds opportunity in change and thrives on adapting
to it. While deal structures may evolve, the fundamental skills involved in
identifying businesses with potential, redefining their strategy, and driving
improvement remain the same. The Board retains confidence in the Manager's
ability to identify a regular flow of opportunities and to add value for the
benefit of shareholders.

With a young portfolio of investments as a base for value creation in coming
years and strong liquidity, the Board believes the Company is well placed to
continue growing while taking advantage of improved market conditions for the
acquisition of good businesses at reasonable prices. The Board is confident
that, for many investors, an allocation to a well-managed private equity
portfolio remains appropriate in current market conditions, especially with the
liquidity and transparency offered by an investment trust structure. HgCapital
Trust has delivered consistent value creation to shareholders for more than a
decade and the Board believes it will continue to provide investors with an
efficient vehicle for gaining exposure to a diversified portfolio in an asset
class that offers attractive long-term prospects for growth.

Roger Mountford
Chairman
17 March 2008


Historical total return* performance

               One year    Three years     Five years    Seven years   Ten years
                 % p.a.         % p.a.         % p.a.        %  p.a.      % p.a.

Net asset value    30.0           27.2           25.3           14.7        16.1
Share price         7.9           21.7           31.9           14.8        17.9
FTSE All-Share
Index               5.3           14.5           15.4            4.6         6.2
FTSE Small Cap
Index             (10.5)           9.7           16.0            3.4         6.6

Based on the Company's share price at 31 December 2007 and allowing for
dividends to be reinvested, an investment of £1,000 ten years ago would now be
worth £5,183

An equivalent FTSE All-Share Index return would be worth £1,824

* Total return assumes all dividends have been reinvested.

Investment activity

                      1998  1999  2000  2001  2002  2003  2004  2005  2006  2007

Invested (£m)            8    40    25    20    20    15    22    35    45    50

Realised (including
income) (£m)            19    30    18    26    27    31    47    52    62   106

HgCapital Trust plc gives the investor access to a private equity portfolio run
by an experienced and well-resourced Manager who makes investments in fast
growing companies over a number of geographies and sectors.

We believe our approach will continue to reward investors with superior
performance, both relative to the public markets and its peers over the long
term.

Investing in private equity

Strong performance in absolute terms and relative to other asset classes

Private equity

Private equity describes securities issued by private and unlisted companies.
The securities are loans, equity and equity-related, enjoying the full rewards
and risks of ownership. Investments can be in early-stage businesses, or provide
expansion capital for profitable growing businesses, and can be used to finance
management or leveraged buyouts of established businesses. The objective is to
achieve higher returns than public equity over a rolling period of five to ten
years. Investments are typically held for three to seven years and are realised
through an initial public offering, a trade sale, or a sale to another financial
institution. Interim proceeds are sometimes possible through recapitalisations.

Investment profile

Private equity investments are less liquid than public equities. To compensate
for this feature they offer more control and more attractive returns. Over the
ten years from 1996 to 2006 UK private equity funds outperformed the FTSE
All-Share Index by 10.8% per annum and outperformed every asset class over this
period*. The risk profile of an individual private equity investment depends on
many factors; the principal ones are the nature of the business, the maturity
and stage of the business, its size and the financial structure of the balance
sheet.

A diversified portfolio helps to mitigate some of these risks; more important
mitigants are the quality of company selections by the private equity manager
and the quality of the management teams running the company.

Advantages of private equity

Compared with investment in the public markets, a private equity investor has
significant advantages:

• More investment opportunities: significantly more private than listed
  companies

• Better access to information: the ability to conduct detailed market,
  financial, legal and management due diligence

• More control for the private equity manager over the management of the
  business and the timing of its sale

• Alignment of interest of owners and management, leading to better decision
  making: the opportunity to act like an owner rather than a fund manager, with
  the benefit of representation on the Board
 
• Management talent: the ability to attract high calibre management and the
  alignment of management's interests to the success of the investment through
  equity participation

Private Equity Investment Trusts (PEITs)

A Private Equity Investment Trust (PEIT) offers the opportunity to participate
in a diversified portfolio of mainly unquoted companies that are generally
valued at a discount to their quoted peers. By buying shares in a PEIT, which
are freely traded, the investor benefits from liquidity while participating in
the potentially superior returns of a private equity portfolio.

The Company's objective is to provide shareholders with long-term capital
appreciation rather than dividend growth. To maintain its status as an
investment trust, it distributes a proportion of its income by way of a dividend
each year. The earnings of a PEIT in any year are affected by various factors,
including the structure of the underlying investments. Accordingly the revenue
earnings per share and the dividend of a PEIT will tend to fluctuate from year
to year. A PEIT should not be confused with a Venture Capital Trust (VCT) which
offers tax advantages to certain investors but is highly constrained in the
companies that qualify for investment.

Advantages of investment via an investment trust

PEITs offer investors liquidity in their shares, which can be traded in variable
bargain sizes and at any time. This is of significant benefit to investors who
do not wish to commit to the ten year lock-in and minimum investment required
when investing in private equity via limited partnerships.

Share price

The major driver of a PEIT's share price is net asset value (NAV), the growth of
which is driven by realisations and by revaluation of the unrealised portfolio,
based on the profitability of each underlying investment and market ratings. The
share price of a PEIT usually tracks NAV but it may trade at a premium or a
discount, depending on the market's view of future realisations and new
investments, and the investment strategy of the manager. Although not all PEITs
will provide high returns, a strong manager with a carefully thought-out
investment strategy that offers a diversified portfolio of companies across a
number of sectors and geographies can increase the likelihood of success.

Publication of net asset value

Unquoted investments are revalued twice each year, as at December and June, and
the NAV is adjusted to reflect these valuations in the following March and
August respectively. The NAV per share of the Company is calculated monthly with
respect to cash, cash equivalents and listed investments in the portfolio, and
to reflect any realisations since the previous valuation. The NAV is released to
the public through the London Stock Exchange's regulatory news service on the
fourth day of each month. This NAV is then used as the basis for calculation of
the discount or premium published in newspapers for the following month.

* Source: BVCA Performance Measurement Survey 2006.

Manager's strategy

To produce a diversified portfolio of European mid-market companies by combining
deep sector knowledge with strong operational skills

OUR STRATEGY

Mid-market

HgCapital concentrates on mid-market buyouts with enterprise values of between
£50 million and £500 million. This market comprises a high volume of companies
with proven, reliable track records and defensible market positions. Companies
in this range are small enough to provide opportunities to unlock incremental
value through organisational changes and operational improvements, yet large
enough to attract quality management and to offer multiple exit options.

Pan-regional

We focus on investments in Europe, with the majority of activity taking place in
the UK, Benelux, Germany and the Nordic countries. Our network of local offices,
combined with a common culture and consistent processes, underpins our ability
to produce strong performance.

Broad coverage

HgCapital's dedicated sector teams continue to provide investors with exposure
to the substantial majority of private equity activity within its target size
range and across the relevant geographies.

Clear investment criteria

When evaluating an investment opportunity, HgCapital applies a rigorous and
commercial investment approach. Our process governs all investment decisions,
with the goal of ensuring that only the most attractive investments are
completed, irrespective of an opportunity's sector or geography.

In all cases we look to earn a return on the Company's capital that rewards the
investor for the measured risks we take. We like situations where change is
taking place and where our specialist knowledge and skills will give us an edge
over others.

Over the past two years we have adopted a two-pronged approach to avoid
overpaying. We have been prepared to pay competitive prices for businesses that
have strong management teams, leading market positions, high barriers to entry
and that serve growth markets. Alternatively, we have bought companies at lower
valuations that serve growth markets, have clear performance improvement
potential and have a requirement for management change.

OUR TACTICS

Sector specialisation

Our well-resourced sector teams combine the domain knowledge and expertise of a
trade buyer with the flexibility of a financial investor. Our sector teams
(Consumer and Leisure, Healthcare, Industrials, Services and TMT) share a
similar top-down approach to screening their respective industries. By
leveraging on our sector knowledge, we can concentrate our resources on
converting prime opportunities and avoid spending time on transactions of less
interest or value.

In addition, over the last four years we have built a specialist team to
identify businesses that will operate, construct and develop renewable energy
projects in Western Europe.

Active portfolio management

We undertake intensive, continuous, informed interaction with our portfolio
companies using dedicated portfolio management executives to develop, execute
and monitor value-enhancement strategies for each of our investments. HgCapital
will typically invest as the lead controlling owner of its portfolio companies
as part of its hands-on approach to management. We appoint HgCapital executives
to our companies' boards to participate in business planning and to work with
management when needed, and have recently strengthened this team with a number
of senior appointments. To monitor and analyse our portfolio companies
throughout the investment's life cycle, we operate a Portfolio Review Committee
that meets on a monthly basis to discuss our investments' performance.
Particular attention is given to those that are recent, underperforming or
scheduled for exit.

Deep resources

We invest substantially in all areas of our business to ensure that high quality
resources can be applied to each aspect of an investment opportunity. Our team
of over 70 people is well-positioned to produce high absolute returns over the
long term from a well-diversified portfolio of investments which, we believe,
will continue to be superior to the returns generated by comparable public
equity markets.

Manager's review

2007 was another record year for realisations and investments, with the current
portfolio continuing to perform well

HgCapital Trust ('the Company') invests alongside other clients of HgCapital.
Typically, the Company's holding forms part of HgCapital's much larger
controlling interest in buyout investments of companies with an enterprise value
(EV) of between £50 million and £500 million. The Manager's review generally
refers to each transaction in its entirety, apart from the tables detailing the
Company's participation or where it specifically says otherwise.

The Company's net asset value increased from £187.1 million to £238.8 million
during the year. This arose largely from unrealised movements and realised
proceeds in excess of the book value as at 31 December 2006 of £12.5 million and
£43.2 million respectively. This increase is the result of strong earnings
growth and cash generation by our portfolio companies, as well as a good flow of
realisations.

During the year, the Company invested a total of £50.8 million (2006: £45.3
million), participating in eight new investments. These new investments were
made in Fabory (Netherlands, €345 million EV), Atlas (UK, £25 million EV), Mondo
Minerals (Finland, €230 million EV), SLV (Germany, €320 million EV), CS Group
(UK, £100 million EV), Americana (UK, £186 million EV), Cornish Bakehouse (UK,
£9 million EV) and Wastebidco (UK).

During the year, the Company invested a further €3.5 million out of its €21
million commitment to the €300 million Hg Renewable Power Partners fund. The
fund's focus is on long-term investments in renewable power projects using
proven technologies, including wind, small hydro, landfill gas and
waste-to-energy in Western Europe.

The Company realised record proceeds during the year (including gross income
received) amounting to £106.3 million (2006: £62.3 million). These proceeds
arose principally from the sale of Schenck, Hirschmann and the combined sale of
IRIS Software and CS Group.

Since the period end, we have made one new investment in Casa Reha (Germany,
€327 million EV). We have also completed the sales of Hofmann Menu, The
Sanctuary Spa and Clarion Events, with clients receiving proceeds of £58.4
million, £50.0 million and £73.9 million respectively. In addition we have sold
our remaining shares in Xyratex and PRA for £23.7 million and £10 million
respectively. In aggregate these realisations have returned proceeds of £216
million to clients, of which the Company received £50.3 million.

Attribution analysis of current year movements in net asset value

                                                                         £'000

Opening net asset value as at 1 January 2007                           187,135
Gross revenue                                                           12,129
Expenditure                                                             (4,028)
Taxation                                                                (2,418)
Dividends paid                                                          (3,526)
Realised proceeds in excess of 31 December 2006 book value
(excludes gross revenue)                                                43,170
Net unrealised appreciation of investments                              12,544
Carried interest                                                        (6,189)
Closing net asset value as at 31 December 2007                         238,817

Realised and unrealised movements in net asset value during 2007

                     Net unrealised               Realised proceeds  
                    appreciation of                    in excess of 
                    investments £'m                31 December 2006
                                                      book value £m
                                           (excludes gross revenue) 

Schenck                        0.3                             20.5
Blue Minerva                   1.4                             10.4
Hofmann                        6.1                                -
Guildford                      0.9                              4.9
Sanctuary                      5.5                                -
Addison                        5.2                                -
Hirschmann                     0.7                              4.1
Forex gains                    3.5                                -
Doc Morris                     0.2                              2.8
Clarion Events                 1.9                                -
Other & Gilts                    -                              0.5
Hoseasons                     (1.0)                               -
WET                           (1.2)                               -
Clinphone                     (1.5)                               -
Axiom                         (1.5)                               -
Elite                         (3.4)                               -
FTSA                          (4.6)                               -
Subtotal                      12.5                             43.2

Manager's review continued

A diverse portfolio that is performing well, with strong long-term growth
potential

At the end of 2007, the Company held a portfolio of 45 investments (2006: 42),
of which the 20 principal investments represent over 90% of the portfolio's
value. This portfolio of small- and mid-cap stocks combines strong growth with
sector and geographic diversification.

With the high number of realisations and new investments made during 2006 and
2007, the portfolio at year-end was relatively young. Around 54% of the
portfolio by value had been acquired within the previous two years (2006: 55%).
It is the Company's policy not to revalue any investment upwards until receipt
of audited accounts for a full trading year following acquisition; as a result,
some 48% of the portfolio by value at year-end was still held at cost (2006:
49%).

The Company's ten largest investments, which represent over 60% of the Company's
portfolio, are performing well, realising solid year-on-year growth in earnings.
A majority of these by value continue to be held at cost. At the same time, a
minority of investments performed below expectation in the year, most notably
FTSA, Elite and Axiom.

Over the last three years, the focus of the portfolio has shifted towards
Continental Europe, with over half the Company's investments by value located
outside the UK. We believe this to be advantageous, as private equity in these
markets is less mature than in the UK and they therefore offer significant
potential for growth over the next decade.

We look forward to exploiting new opportunities that will arise from a downward
adjustment in the capital markets and the economy.

The Company benefits from strong liquidity, holding £79.8 million in liquid
funds at year-end awaiting reinvestment.

It also has a £25 million borrowing facility.

Asset class+
Unquoted                                                                    62%
Cash & other assets                                                         35%
Quoted                                                                       3%

Geographic spread by value++
UK                                                                          45%
Germany                                                                     24%
Nordic region                                                               14%
Benelux                                                                     13%
Europe                                                                       2%
North America                                                                2%


Valuation basis++
Cost                                                                        48%
Earnings                                                                    28%
Third Party                                                                 10%
Written down                                                                 7%
Quoted                                                                       4%
Net assets                                                                   3%

Deal type by value++
Buyout                                                                      86%
Expansion                                                                   10%
Renewable energy                                                             2%
Fund                                                                         1%
Venture                                                                      1%

Sector by value++
TMT                                                                         29%
Industrials                                                                 22%
Consumer & Leisure                                                          22%
Services                                                                    17%
Healthcare                                                                   7%
Renewable energy                                                             2%
Fund                                                                         1%

Vintage by value++

2007                                                                        28%
2006                                                                        26%
2005                                                                        20%
2004                                                                         7%
2003                                                                         8%
2002                                                                         1%
Pre 2002                                                                    10%*

*includes 7.5% relating to The Sanctuary Spa, which has been sold post period
 end

+Percentages are based on net assets
++Percentages are based on fixed assets and are shown by value

Investments

During 2007 HgCapital invested a total of £322 million on behalf of its clients,
including £50.8 million on behalf of the Company

Company                      Sector        Activity                         Deal Type     Cost
                                                                                         £'000

BMFCO (t/a Fabory)           Services      Distributor of industrial        Buyout      10,871
                                           fasteners
Atlas Energy                 Services      E-learning products for the oil  Buyout       8,153
                                           & gas industry
Mondo Minerals               Industrials   Talc mining                      Buyout       7,004

SLV Electronik               Industrials   Lighting products                Buyout       5,962
Guildford (t/a CS Group)     TMT           Software services to the legal & Buyout       5,046
                                           not-for-profit sectors
Americana                    Consumer &    Wholesaler and retailer of       Buyout       4,611
                             Leisure       fashion apparel
Cornish Bakehouse            Consumer &    Pasty retailer                   Expansion    4,200
                             Leisure
Wastebidco                   Industrials   Investment vehicle for potential Buyout         309
                                           acquisiton of Biffa plc
New investments                                                                         46,156
Sporting Index               Consumer &    Spread betting                   Buyout       1,758
                             Leisure
FTSA                         Industrials   Crash test dummies               Buyout         578
Axiom                        TMT           Telecommunications software      Expansion       85
Hg RPP LP                    Renewable     Renewable energy fund            Fund         2,180
                             energy
Further investments                                                                      4,601
Total investment by the Company                                                         50,757

Figures below refer to the total size of each acquisition, including debt raised
from third parties, made by HgCapital on behalf of its clients, including the
Company.

New investments

Fabory

In October 2007, HgCapital completed the €345 million buyout of Fabory, the
leading distributor of industrial fasteners in the Benelux region. Its Fabory
Centres (FCs) have proved a highly successful retail format and the company is
poised for an aggressive roll-out of further FCs in the high-growth markets of
Central and Eastern Europe.

Atlas

In November 2007, HgCapital completed the £25 million buyout of Atlas. Founded
in 1997, Atlas Interactive is a leading provider of interactive e-learning
products, targeted at regulatory-driven health, safety and environmental
training for the oil and gas sector. Over the past 10 years the business has
seen rapid organic growth and its customers include leading companies such as
BP, Shell and QatarGas.

Mondo Minerals

In November 2007, HgCapital completed the €230 million buyout of Mondo Minerals.
Mondo is one of the world's leading companies in talc mining and processing and
has secure reserves of raw materials for the next 40 years. Mondo's customers
are active in a variety of European industries including paper, paint, plastics,
and ceramics. The group supplies clients in more than 50 countries.

SLV

In August 2007, HgCapital completed the €320 million buyout of SLV Group. SLV
Group is one of the fastest-growing manufacturers of innovative lighting systems
in Europe. It combines German design excellence, low-cost production in Asia and
first class logistics.

CS Group

In April 2007, HgCapital completed the £100 million P2P buyout of CS Group, the
UK's leading provider of back-office application software to the legal and
not-for-profit sectors. CS Group was sold in a combined sale with IRIS in July
2007, delivering a return of 2.2x original cost, including the unrealised value.
Further details are set out in Realisations.

Americana

In March 2007, HgCapital completed the £186 million buyout of Americana, the
branded apparel business, which owns the youth brands Bench and Hooch. Revenues
are predominantly through UK wholesale channels although the business is
increasing its wholesale revenues in Continental Europe and building a UK retail
presence.

Cornish Bakehouse

In July 2007, HgCapital completed the £9 million buyout of Cornish Bakehouse,
the St Ives-based pasty retailer. It sells a full take-away range, predominantly
for lunchtime trade, at a higher quality level than direct competitors. We are
backing a proven management team that previously grew and sold a very successful
specialist retail chain.

Wastebidco

Wastebidco is a specially formed acquisition vehicle set up to acquire shares in
Biffa plc, an integrated UK waste management company, and which now owns 2.4% of
Biffa's share capital. As announced by the target on 24 January 2008, HgCapital
withdrew from the consortium formed with Montagu. Assuming that a transaction
occurs with the new Montagu consortium then it is intended that Wastebidco's
shares in Biffa plc will be tendered at the consortium's offer price.

Realisations

During 2007 HgCapital realised total proceeds of £688 million on behalf of its
clients, including £106.4 million for the Company

Company                      Sector        Exit Route           Cost   Proceeds +   2007 return +
                                                               £'000        £'000           £'000

Schenck                      Industrials   Financial sale     11,698       33,952          22,254
Blue Minerva (t/a IRIS)      TMT           Financial sale      2,939       17,660          14,721
Hirschmann                   Industrials   Financial sale      2,669       14,874          12,205
Guildford (t/a CS Group)     TMT           Financial sale      5,031        9,967           4,936
Doc Morris                   Healthcare    Trade sale          1,956        4,739           2,783
Worldmark                    Industrials   Financial sale      2,389        3,569           1,180
Bertram                      Consumer &    Trade sale          2,848        2,009            (839)
                             Leisure
Eagle Rock                   TMT           Sale to             3,856        1,618          (2,238)
                                           management
South Wharf plc*             Industrials   Quoted share           47        1,033             986
                                           sale
Other                                                             96          366             270
Full realisations                                             33,529       89,787          56,258

Xtx t/a Xyratex**            TMT           Quoted share        1,895        4,957           3,062
                                           sale
Addison                      TMT           Recapitalisation    4,203        5,441           1,238
Rolfe & Nolan                TMT           Recapitalisation      225        2,093           1,868
Voyage (formerly Paragon)    Healthcare    Loan redemption     1,991        1,991               -
SHL                          Services      Loan redemption     1,046        1,127              81
Other                                                          4,501          994          (3,507)
Partial realisations                                          13,861       16,603           2,742
Total realisations                                            47,390      106,390          59,000
by the Company

+ Includes gross revenue received during the year
* Listed on the Dublin and London stock exchanges
** Traded on NASDAQ

Realisation figures below refer to the total value of each transaction,
including, where appropriate, repayment of third party debt. Proceeds to clients
including the Company are stated net of any such repayment.

Full realisations

Schenck

In December 2005, HgCapital completed the €205 million buyout of Schenck Process
SA, the global market leader in high-tech applications and solutions in
industrial weighing, feeding and automation. In June 2006, Schenck completed the
acquisition of Stock Equipment Company (USA) Inc. In November 2007 the business
was sold, returning proceeds to clients of £174 million, equal to 2.9x original
cost.

IRIS Software

The £102 million secondary management buyout of IRIS Software Ltd was completed
in July 2004. In June 2007, a deal was signed to sell IRIS to Hellman & Friedman
in a combined sale with CS Group. On completion this delivered £105.1 million to
clients. Of this amount, £92.5 million has been received as cash and £12.6
million as equity in the newly combined IRIS-CSG, delivering a 3.6x return,
including the unrealised value.

Hirschmann

In March 2004, HgCapital completed the €115 million buyout of Hirschmann
Electronics. Hirschmann is the market-leading global supplier of electronics
equipment, components and related accessories. It has manufacturing plants in
Germany and Hungary as well as sales and service operations in Europe, the USA,
the Far East and South America. The business was sold in March 2007, with
proceeds of €113 million received for clients. Further proceeds of €25 million
were received in April 2007, with the potential of a further €15 million over
the next 2-3 years, subject to any warranty claims. This investment has returned
5.8x original cost, including the unrealised value of potential future payments.

CS Group

In April 2007 HgCapital completed the £100 million P2P buyout of CS Group, the
UK's leading provider of back-office application software to the legal and
not-for-profit sectors. CS Group was sold in a combined sale with IRIS in July
2007, delivering £87 million to clients. As with IRIS, of this amount, £76.6
million has been received in cash and £7.4 million as equity in the newly
combined IRIS-CSG. This has delivered a 2.2x return, including the unrealised
value.

DocMorris

Founded in 2000 as a mail order business, DocMorris has grown to become the
largest pharmacy serving the German market. It offers prescription drugs at
attractive prices by sourcing direct from the pharmaceutical manufacturers. In
April 2007 HgCapital, together with 3i and Neuhaus Partners, sold their stakes
to Celsio AG, Europe's largest pharmaceutical distributor. This investment
returned 2.5x original cost, including the unrealised value of future escrow
payments.

Worldmark

Worldmark is a supplier of labels to the electronics industry. We bought the
business in 2000, then its market deteriorated rapidly. We changed its focus and
board leadership, and the business recovered.

The business was sold in January 2007. Clients received proceeds amounting to
£29.2 million, representing a 1.5x multiple of cost.

Bertram

Bertram is a book wholesaler and distributor of books, games and audio-visual
titles to public libraries. Following the acqusition of Bertram in 1999, the
business made mistakes in the execution of its strategy. We changed the
management team, trading improved and eventually in February 2007, the business
was sold to Woolworths plc. Proceeds of £13.1 million were received for clients,
representing an overall return of 0.7x original cost.

Eagle Rock

Eagle Rock creates and acquires audio and audio-visual entertainment productions
with a strong focus on rock music by mature and established international
artists. It exploits these intellectual property rights through DVD, TV
licensing and CD. All manufacturing and distribution are outsourced, as is most
of the production. In April 2007, the company was sold to management and an
investment consortium. Proceeds of £7.5 million were received for clients,
representing a return of 0.4x original cost.

South Wharf

Following the demerger of the glass business, South Wharf became a property
company, owning 26 acres of long-leasehold land and a small glass trading
activity. Title to the land was improved significantly so that it could be sold.
We sold our quoted shares for proceeds of £49.8 million. Over its life, this
investment has returned a multiple of 7.3x original cost.

Partial realisations

Xyratex

Xyratex has been a world leader in the hard disk and network storage technology
market for over 20 years. It completed its IPO on NASDAQ on 24 June 2004 at a
price of $14 per share, realising £10.2 million for HgCapital clients at the
time. HgCapital has since selectively sold stock with a total value of
approximately £80 million from the time when our lock-up period expired in early
2005 until July 2007.

Since the period end, the residual stake was sold for £23.7 million, resulting
in a total return of 2.25x original cost.

Addison

Addison is a leading German applications software company that provides
business-critical solutions to two related markets - tax accountancy and small
to medium enterprises (SMEs). It develops, licenses and manages standard and
sector-specific software for bookkeeping, accounts production, tax, cost
accounting, payroll administration and financial planning. Addison is the clear
number two player in the German market and the fastest-growing. The business was
recapitalised in October 2007, returning £28 million to clients.

Rolfe & Nolan

Rolfe & Nolan is the number two global supplier of back-office processing
software to the exchange traded derivatives industry. It supports over 250 bank,
brokerage and exchange clients in 20 countries. Customers include Deutsche Bank,
Goldman Sachs, HSBC, Lehman Brothers and MAN Financial.

The business has been recapitalised a number of times, most recently in June
2007, which returned £12 million to clients. Over its lifetime this investment
has returned 2.2x original cost, including the unrealised value.

Loan redemptions

During the period, partial redemptions of loan stock from Voyage and SHL
returned proceeds of £13 million and £9 million respectively.

Other realisations

Other realisations received during the period include deferred considerations
from earn-outs on PBR and Mednova and cash distributions received from residual
overseas fund investments. The restructuring of Pulse Staffing Limited (formerly
Match) resulted in the original loan stock being cancelled and the remaining
investment is now held in an equity instrument.

Review of principal investments

1 VISMA

Sector: TMT
Location: Nordic region
Year of investment: 2006
www.visma.com

In May 2006, HgCapital completed the £382 million buyout of Visma, the number
one provider of business software in the Nordic region. HgCapital's clients hold
a 57% stake in this business.

Headquartered in Oslo, with significant revenues throughout the Nordic region,
the company provides its customer base of over 200,000 enterprises with
accounting, resource planning and payroll software, outsourced book-keeping and
payroll services, in addition to debt collection and procurement.

2 The Sanctuary Spa

Sector: Consumer and Leisure
Location: UK
Year of investment: 1995
www.thesanctuary.co.uk

In July 2005, our original investment in the Sanctuary Spa Group was acquired by
the newly incorporated The Sanctuary Spa Holdings Limited (SSHL).
Simultaneously, SSHL acquired the licence to sell beauty products branded The
Sanctuary Spa, the rights to which had previously been held by a third party
licensee. HgCapital's clients took a 78% stake in the business.

The Sanctuary Spa operates the women's day spa 'The Sanctuary', based in Covent
Garden, and also owns a range of beauty products distributed through the spa and
Boots the Chemist. In 2006, we received £9 million from loan stock repaid.

Post year-end, The Sanctuary Spa has been sold to PZ Cussons for £75 million,
returning £50 million to clients.

3 Fabory

Sector: Services
Location: Benelux
Year of investment: 2007
www.fabory.com
In October 2007, HgCapital acquired Fabory from AAC Capital Partners for a
consideration of €345 million. HgCapital's clients hold a 79% stake in this
business.

Fabory is a full-line wholesale distributor of industrial fasteners with a
market-leading position in the Benelux markets. Key features of Fabory's
business model are its well-invested infrastructure and very high service and
availability levels, enabling it to charge premium prices to a relatively
price-insensitive customer base. Fabory delivers fasteners direct to customers
or through its B2B retail concept ('Fabory Centres'). The company plans to roll
out the Fabory Centre concept in the high growth economies of Central & Eastern
Europe.

4 Hofmann

Sector: Industrials
Location: Germany
Year of investment: 2005
www.hofmann-menue.de

In November 2005, HgCapital successfully completed the €138 million buyout of
Hofmann Menu for a 78% equity stake in the business.

Hofmann is a market-leading provider of frozen food products as well as related
on-site catering for small business canteens and social organisations such as
care homes, hospitals and schools in Germany. Hofmann differentiates itself from
its competition by focusing on quality and a wide choice of healthy, tasty
menus. The company's centralised production also allows for significant cost
advantages over traditional catering firms.

Since the year-end the sale of the business to Gilde Buy Out Partners has
completed, returning £58.4 million to clients.

Cost and valuation of the Company's holdings

Company                         Deal type     Residual    Valuation        Valuation    Portfolio
                                                  cost        £'000            basis        value
                                                 £'000                                          %

VISMA Holdings *                Buyout          13,268       13,812             Cost          8.9
The Sanctuary Spa Holdings Ltd  Expansion          631       11,628         Earnings          7.5
BMFCO UA (t/a Fabory) *         Buyout          10,871       11,428             Cost          7.4
Hofmann M.M. SA                 Buyout           4,747       10,774      Third Party          7.0

* The difference between cost and valuation is due to foreign exchange rate
  movements

5 Voyage Group

Sector: Healthcare
Location: UK
Year of investment: 2006
www.milburycare.com

In April 2006, HgCapital completed the £322 million buyout of Voyage Group
(formally known as Paragon Healthcare). HgCapital's clients have a 52% stake in
this business.

Voyage owns and operates small community-based homes for adults with learning
disabilities and associated physical disabilities, autistic spectrum disorders,
complex needs and acquired brain injury. The company uses a variety of
techniques as therapy, including working with animals.

The company currently operates 1,750 places in 242 homes across England and
Scotland.

6 Atlas

Sector: Services
Location: UK
Year of investment: 2007
www.atlasinteractive.co.uk

In November 2007, HgCapital completed the £25 million acquisition of Petrolearn
Limited, also known as Atlas Interactive. HgCapital's clients have a 57% stake
in the business.

Atlas Interactive is a leading provider of interactive e-learning products,
targeted at regulatory-driven health, safety and environmental training for the
oil and gas sector. Atlas Interactive has a global market share of around
1-1.25% (25% to 38% UK market share), making it a relatively large player in
this fragmented space. It benefits from deep-rooted customer relationships with
major companies such as BP, Shell and QatarGas, and maintains a high level of
repeat business. In addition, it has amassed over 1,000 hours of standardised
intellectual property-protected e-learning content that it resells to its
customer base.

7 Clarion Events

Sector: TMT
Location: UK
Year of investment: 2004
www.clarionevents.co.uk

The £50 million buyout of Clarion Events, the largest independent exhibition and
events business in the UK, completed in October 2004, with HgCapital's clients
taking a 65% equity stake in the business.

The company has a portfolio of fifty business and consumer shows, including the
'Top Drawer' giftware trade shows, 'Fine Art & Antiques', 'Baby', 'Caravan &
Outdoor' and 'House & Garden'. Clarion's subsidiary ATE, acquired in June 2005,
runs the leading international show for the amusements and gaming sector, and
related conference and publishing services. Since the year-end the business has
been sold, returning £73.9 million to clients.

8 Addison

Sector: TMT
Location: Germany
Year of investment: 2005
www.addison.de

The €78 million buyout of Addison was completed in June 2005. HgCapital's
clients have a 93% equity stake in the business.

Addison is a leading German applications software company that provides
business-critical solutions for tax accountants and SMEs. It develops, licences
and manages standard and sector-specific software for bookkeeping, accounts
production, tax, cost accounting, payroll administration and corporate planning.

In December 2005, HgCapital made a further investment in Addison of €14 million
to fund the acquisition of its competitor PBSG, and in November 2007 a
recapitalisation of the business was completed to enable the company to pursue
its growth strategy, returning £28 million to clients.

Cost and valuation of the Company's holdings

Company                        Deal type      Residual    Valuation      Valuation    Portfolio
                                                  cost        £'000          basis        value
                                                 £'000                                        %
Voyage Group Ltd (formerly
Paragon)                       Buyout            8,755        8,755           Cost          5.7
Atlas Energy Group Ltd         Buyout            8,153        8,153           Cost          5.3
Clarion Events Holdings Ltd    Buyout            4,965        7,594       Earnings          4.9
Addison Luxembourg SA          Buyout            2,296        7,547       Earnings          4.9

9 Mondo Minerals

Sector: Industrials
Location: Nordic region
Year of investment: 2007
www.mondominerals.com

In November 2007, HgCapital completed the €230 million acquisition of Mondo
Minerals OY. HgCapital's clients have a 91% stake in the business.

Mondo is the world number two in talc mining and processing with 2007 revenues
of €134 million. The core markets for Mondo are the paper and paint industries,
where it holds a market share of 65% and 40% respectively in Europe. Mondo
supplies the majority of the talc demand for paper producers in Finland, a
highly regional market. Talc is a base chemical with multiple proven
applications and Mondo has secure raw material reserves of more than 40 years.

10 Sporting Index

Sector: Consumer and Leisure
Location: UK
Year of investment: 2005
www.sportingindex.com

The £75.8 million buyout of Sporting Index was completed in November 2005.
HgCapital's clients acquired a 70% equity stake in the business.

Founded in 1992, Sporting Index is the recognised leader in sports spread
betting, with a market share of approximately 70% in the UK. It offers a greater
variety of bets (approximately 23,000) and more choice than any other sports
spread betting company. It is also the only sports spread betting company to
offer continuous 24-hour betting and sports spread betting on Sky TV. It is
regulated by the FSA and does not have a US presence.

11 SHL

Sector: Services
Location: UK
Year of investment: 2006
www.shl.com

In November 2006, HgCapital completed the £100 million buyout of SHL, taking a
stake of 72%.

SHL is the UK market leader in objective psychometric testing and has a global
presence. The core business consists of the development and sale of 300
psychometric tests to corporate clients, covering areas such as numerical
ability, verbal reasoning and personality fit. SHL also provides psychologists
for the administration and interpretation of tests.

12 SLV

Sector: Industrials
Location: Germany
Year of investment: 2007
www.slv.de

In August 2007, HgCapital completed the €320 million acquisition of SLV Group.
HgCapital's clients have a 67% stake in the business.

SLV is a fast-growing and highly profitable German provider of innovative
lighting systems. Since 2000, the company has established a unique business
model focused on B2B. SLV has a competitive advantage in the areas of product
development and design, production, warehousing, and logistics and distribution.
SLV is positioned at the lower end of the premium market, providing superior
quality at attractive prices. Today SLV generates 45% of sales abroad.
Manufacturing is outsourced predominately to China, providing a considerable
cost advantage. The company also benefits from long-established relationships
with suppliers.

Cost and valuation of the Company's holdings

Company                    Deal type    Residual     Valuation     Valuation     Portfolio
                                            cost         £'000         basis         value
                                           £'000                                         %

Mondo Minerals Co-op *     Buyout          7,004         7,358          Cost           4.8
Sporting Index Group Ltd   Buyout          7,186         7,186          Cost           4.7
SHL Group Holdings 1 Ltd   Buyout          6,489         6,489          Cost           4.2
SLV Electronic SARL *      Buyout          5,962         6,438          Cost           4.2

* The difference between cost and valuation is due to foreign exchange rate
  movements

13 Sitel Semiconductor

Sector: TMT
Location: Benelux
Year of investment: 2005
www.sitelsemi.com

The $74 million buyout of the digital cordless business unit of National
Semiconductor Corporation completed in June 2005. HgCapital's clients acquired
an 81% equity stake in the business.

Elite creates products and systems to support wireless voice and data
applications for the home. These include: baseband and radio transceivers for
cordless DECT (Digital Enhanced Cordless Telephony); telephones and base
stations for VoIP (Voice over Internet Protocol); and cordless game pads and
voice modules. The company, which was formerly part of National Semiconductor
Corporation, is based in Den Bosch and Hengelo, Netherlands, and employs
approximately seventy people.

14 W.E.T.

Sector: Industrials
Location: Germany
Year of investment: 2003
www.wet.de

The €169 million public-to-private transaction to acquire W.E.T. Automotive
Systems AG was declared unconditional in September 2003, with acceptances of
over 76.3%. HgCapital's clients acquired a 70% equity stake in the business.

W.E.T. Automotive Systems is the world market leader for seat-heating systems,
supplying most of the major European and North American passenger car seat
manufacturers as well as Asia from its Chinese facility.

The weak US dollar and a slow North American market have both had an impact on
profitability, although within Europe and China the business is performing well.
A profit-improvement programme has been implemented and the sensors business has
been divested.

15 Schleich

Sector: Consumer and Leisure
Location: Germany
Year of investment: 2006
www.schleich-s.de

In December 2006, HgCapital completed the €165 million buyout of Schleich
acquiring an 80% stake in the business.

Schleich is the leading producer of plastic toy figurines, such as farm and
wildlife animals, historical characters and The Smurfs. Its products, trading
under the highly recognised name Schleich-S, are sold in over thirty countries,
including Germany, the US, the UK and France. Growth drivers are product
innovation and internationalisation. Toy figurines provide an attractive product
offering for retailers as they are purchased on different occasions throughout
the year in contrast to traditional toy sales patterns, where typically 50% of
sales happen in the two months before Christmas.

16 Americana

Sector: Consumer and Leisure
Location: UK
Year of investment: 2007
www.bench.co.uk

In March 2007, HgCapital completed the £186 million buyout of Americana.
HgCapital's clients have a 43% stake in the business.
Americana is a branded apparel business, manufacturing and marketing two brands
targeted at the youth market, Bench and Hooch. The Bench brand is aimed at both
men and women in the 16 to 25 age group. Hooch is a fashion clothing brand
targeted at the female 13 to 17 age group. Revenues are predominantly through UK
wholesale channels, though the business is increasing its wholesale revenues in
Continental Europe and building a UK retail presence.

A significant upgrade of Americana's management team has recently been
completed. Further opportunities are being explored in international wholesale
expansion beyond Continental Europe and in product range extension.

Cost and valuation of the Company's holdings

Company                            Deal type     Residual   Valuation         Valuation   Portfolio
                                                     cost       £'000             basis       value
                                                    £'000                                         %
Elite Holding SA (t/a Sitel 
Semiconductor)                     Buyout           5,749       6,103          Earnings         4.0
W.E.T. Holding Luxembourg SA       Buyout           7,590       5,417      Written down         3.5
Schleich Luxembourg SA *           Buyout           4,634       5,059              Cost         3.3
Americana International 
Holdings Ltd                       Buyout           4,611       4,611              Cost         3.0

* The difference between cost and valuation is due to foreign exchange rate
movements

17 Cornish Bakehouse

Sector: Consumer and Leisure
Location: UK
Year of investment: 2007
www.cornishbakehouse.com

In July 2007, HgCapital completed the £9 million buyout of Cornish Bakehouse
(shortly to be renamed Cornish Kitchen). HgCapital's clients have a 57% stake in
the business.

Cornish Bakehouse is a pasty retailer founded in 1993 by a St Ives based
entrepreneur. It sells a full take-away offer, predominately for lunchtime
trade, including pasties, sandwiches, baguettes, cakes, pizza, snacks and
drinks. All bakery products are delivered frozen and cooked on site.

A rapid roll-out of outlets is planned under the direction of the high calibre
and experienced management team led by Phillip Newton, former CEO of the
Merchant Retail Group plc, which owns The Perfume Shop, the highest density
retail format in the UK.

18 Xyratex

Sector: TMT
Location: UK
Ticker: XRTX:US
Year of investment: 2003
www.xyratex.com

In September 2003, HgCapital completed the £50 million buyout of Xyratex for a
fully-diluted stake of 45%.

Xyratex is a global provider of enterprise-class data storage subsystems and
storage process technology. Storage technology provides the means by which
business and personal IT data can be captured, processed, stored and retrieved
in a digital form. Since our investment the company has been trading ahead of
plan and, in June 2004, completed an initial public offering on NASDAQ.

Total proceeds to December 2007 were £89.9 million. Since the year-end, the
residual stake has been sold for £23.7 million, resulting in a total return of
2.25x original cost.

19 Hg Renewable Power Partners LP

Sector: Renewable energy
Location: Europe
Year of investment: 2006
www.hgcapital.com/en/energy

The first closing of the fund at €147.1 million took place in June 2006. A final
closing in December 2006 took the fund up to €303 million, including a 1%
co-investment by HgCapital and its employees.

The fund was 26% called as at 31 December 2007. It has made investments to date
valued at €60.0 million including accrued loan stock interest as at 31 December
2007.

20 IRIS Software

Sector: TMT
Location: UK
Year of investment: 2004
www.iris.co.uk

The £102 million buyout of IRIS Software completed in July 2004, with
HgCapital's clients holding a 63% stake in the business.

IRIS is the UK's leading provider of financial, practice management and tax
software to accountancy practices and has an outstanding reputation within its
sector. Under HgCapital's ownership, IRIS acquired four companies for a total
consideration of £31 million and the core business grew revenue by 12-13%.

In July 2007 IRIS was sold to Hellman & Friedman in a combined sale with CS
Group, returning £150 million to clients over the life of the investment,
including the residual unrealised value, resulting in a return of 3.6x original
cost.

Cost and valuation of the Company's holdings

Company                             Deal type           Residual Valuation      Valuation Portfolio
                                                            cost     £'000          basis     value
                                                           £'000                                  %

Cornish Bakehouse Investments Ltd   Expansion              4,200     4,200           Cost       2.7
Xtx Ltd (t/a Xyratex)               Buyout                 1,277     3,721         Quoted       2.4
Hg Renewable Power Partners LP      Renewable energy       3,803     3,555     Net Assets       2.3
Software (Cayman) LP - re IRIS      Buyout                    17     1,999    Third Party       1.3

Hg Renewable Power Partners LP

In June 2006 the Company made a commitment of €21 million to Hg Renewable Power
Partners LP, a dedicated renewable energy fund managed by HgCapital. The €303
million fund is the largest raised to date for renewable energy investments in
Europe. The fund's focus is on long-term investments in renewable power projects
using proven technologies, including wind, small hydro, landfill gas and
waste-to-energy in Western Europe.

Renewable energy benefits from a highly favourable regulatory and policy
environment with climate change solidly on the political agenda. The investment
in the fund will give the Company exposure to a diversified portfolio of assets
offering both income and capital appreciation in a rapidly growing sector.

The fund has investments in eight wind projects in construction or operation
totalling 125 MW and four biogas projects that are in construction totalling 1.4
MW, and has made investments in companies that develop wind and biogas projects
giving it the right to acquire a further 400+ MW of wind projects and 75+ MW of
biogas projects. The fund's investments are in France, Germany, Ireland, Italy
and the United Kingdom.

The fund's portfolio now includes the following investments:

Tir Mostyn

A 21.25 MW operating wind farm in North Wales. The original investment was made
in November 2004, with construction completed in October 2005. The wind farm has
now been operating for over two years.

Sorne Wind

A 32 MW operating wind farm in Donegal, Ireland. This investment was made in
July 2005, with the farm entering operation in November 2006.

Picardy Wind

A portfolio of four wind farms in Northern France in operation or under
construction with a total capacity of 47.5 MW. This investment commenced in July
2006 with the first operational wind farm located near Bougainville. All four
projects sell or will sell power to Electricite de France (EdF) under 15 year
power sales contracts.

Wind Direct

A business that installs, owns and operates wind turbines on UK industrial
sites, providing its customers with low cost, direct energy supplies. The
investment was made in 2006 and includes one site in operation and one entering
construction, with 35 sites in development.

Aufwind Schmack Neue Energien

A company that develops and operates biogas plants in Germany. Biogas plants
ferment agricultural, household and industrial residues, or purpose-grown energy
crops, producing biogas, which is used to generate electricity and heat or which
may be used directly in other gas-dependent processes. This investment was made
in January 2007. Four biogas projects are under construction with a combined
capacity of 1.4 MW.

Schmack Biogas Framework Agreement

The rights to acquire 10 German biogas projects totalling 30 MW from the leading
biogas equipment supplier. This agreement was entered into in December 2007.

Bagmoor Wind Farm

A 16 MW wind farm in construction in Lincolnshire, England. Construction is due
to start in March 2008 with commercial operation expected to begin in 2009.

RidgeWind

A United Kingdom wind farm developer with over 200 MW of wind farms in
development, including a 28 MW project that has secured planning permission.

Rewind

An investment of €2.1 million provided in August 2006 in return for the option
to acquire a 120 MW portfolio of wind farms in Sicily.

Cost and valuation of the Company's holdings

Company                         Deal type           Residual  Valuation     Valuation  Portfolio
                                                        cost      £'000         basis      value
                                                       £'000                                   %

Hg Renewable Power Partners LP  Renewable energy       3,803      3,555    Net assets        2.3

The difference between cost and valuation is due to establishment and running
costs, fees, foreign exchange movements in the fund and the revaluation of
investments


Investment portfolio
     Company       Sector        Principal Residual                Year of Portfolio     Cum 
                                 Location      cost Valuation   investment     value   Value
                                              £'000     £'000                      %       %
                                                 
 1   VISMA         TMT           Nordic      13,268    13,812         2006       8.9%    8.9%
     Holdings +                  region
 2   The Sanctuary Consumer &    UK             631    11,628         1995       7.5%   16.4%
     Spa Holdings  Leisure
     Ltd +
 3   BMFCO UA (t/a Services      Benelux     10,871    11,428         2007       7.4%   23.8%
     Fabory) +
 4   Hofmann M.M.  Industrials   Germany      4,747    10,774         2005       7.0%   30.8%
     SA +
 5   Voyage Group  Healthcare    UK           8,755     8,755         2006       5.7%   36.5%
     Ltd (formerly
     Paragon) +
 6   Atlas Energy  Services      UK           8,153     8,153         2007       5.3%   41.8%
     Group Ltd +
 7   Clarion       TMT           UK           4,965     7,594         2004       4.9%   46.7%
     Events
     Holdings Ltd
     +
 8   Addison       TMT           Germany      2,296     7,547         2005       4.9%   51.6%
     Luxembourg SA
     +
 9   Mondo         Industrials   Nordic       7,004     7,358         2007       4.8%   56.4%
     Minerals                    region
     Co-op +
10   Sporting      Consumer &    UK           7,186     7,186         2005       4.7%   61.1%
     Index Group   Leisure
     Ltd +
11   SHL Group     Services      UK           6,489     6,489         2006       4.2%   65.3%
     Holdings 1
     Ltd +
12   SLV           Industrials   Germany      5,962     6,438         2007       4.2%   69.5%
     Electronik
     SARL +
13   Elite Holding TMT           Benelux      5,749     6,103         2005       4.0%   73.5%
     SA +
14   W.E.T Holding Industrials   Germany      7,590     5,417         2003       3.5%   77.0%
     Luxembourg SA
     +
15   Schleich      Consumer &    Germany      4,634     5,059         2006       3.3%   80.3%
     Luxembourg SA Leisure
     +
16   Americana     Consumer &    UK           4,611     4,611         2007       3.0%   83.3%
     International Leisure
     Holdings
     Ltd
17   Cornish       Consumer &    UK           4,200     4,200         2007       2.7%   86.0%
     Bakehouse     Leisure
     Investments
     Ltd +
18   Xtx Ltd (t/a  TMT           UK           1,277     3,721         2003       2.4%   88.4%
     Xyratex) **
19   Hg Renewable  Renewable     Europe       3,803     3,555         2006       2.3%   90.7%
     Power         energy
     Partners LP
20   Software      TMT           UK              17     1,999         2006       1.3%   92.0%
     (Cayman) LP -
     re IRIS
21   FTSA Holdings Industrials   North        6,813     1,961         2004       1.3%   93.3%
     Ltd +                       America
22   PRA           Healthcare    Benelux      1,478     1,789         2002       1.2%   94.5%
     International
     Inc **
23   Classic       TMT           UK           6,033     1,486         2003       1.0%   95.5%
     Copyright
     (Holdings)
     Ltd
     (t/a Boosey &
     Hawkes) +
24   Weston        Fund          North        1,733     1,181         1998       0.8%   96.3%
     Presidio                    America
     Capital III,
     LP
25   Hoseasons     Consumer &    UK           2,197       965         2003       0.6%   96.9%
     Group Ltd +   Leisure
26   Software      TMT           UK              15       927         2007       0.6%   97.5%
     (Cayman) LP -
     re
     Guildford
27   Rolfe & Nolan TMT           UK              14       836         2003       0.5%   98.0%
     Holdings plc
     +
28   Hirschmann    Industrials   Germany          -       718         2004       0.5%   98.5%
     Electronics
     Holdings SA
     +
29   Orbiscom      TMT           Ireland      2,981       584         2001       0.4%   98.9%
     Ltd
30   Clinphone plc Healthcare    UK               7       499         1996       0.3%   99.2%
     *
31   Wastebidco    Industrials   UK             309       473         2007       0.3%   99.5%
     Ltd ^
32   Axiom         TMT           UK           1,888       413         2001       0.2%   99.7%
     Holdings
     Ltd
33   Schenck       Industrials   Germany          -       258         2005       0.1%   99.8%
     Process SA
     +
34   Pulse         Healthcare    UK             400       207         1999       0.1%   99.9%
     Staffing
     Ltd
35   Doc M SARL    Healthcare    Germany          -       206         2004       0.1%  100.0%
36   ACT Venture   Fund          Ireland          -        36         1994         -   100.0%
     Capital Ltd
37   Euroknights   Fund          Europe         968         1         1996         -   100.0%
     III LP
38   Orbis plc *   Services      UK           3,378         -         1997         -   100.0%
39   Burns         TMT           UK           3,245         -         2001         -   100.0%
     e-Commerce
     Solutions
40   SGI           Services      UK           1,721         -         1999         -   100.0%
     (Holdings)
     Ltd +
41   Profiad Ltd   Healthcare    UK           1,653         -         1999         -   100.0%
     +
42   Newchurch     Healthcare    UK           1,297         -         2000         -   100.0%
     Ltd
43   Azinger Ltd   Services      Ireland        204         -         1993         -   100.0%
44   Lantor plc    Industrials   Ireland          -         -         1992         -   100.0%
     (formerly
     South Wharf
     plc)
45   Weston        Fund          North            -         -         1995         -   100.0%
     Presidio                    America
     Capital II,
     LP
     Total                            148,542   154,367                  100.0%

* Listed on the London Stock Exchange ** Traded on NASDAQ ^ Underlying investment listed on
  the London Stock Exchange
+ HgCapital controls more than 50% of the voting equity shares through its management of the
  Company and other funds

Income statement for the year ended 31 December 2007

                                Note       Revenue return    Capital return       Total return
                                           2007     2006     2007     2006        2007     2006
                                          £'000    £'000    £'000    £'000       £'000    £'000
Gains on investments
and government securities       10            -        -   55,714   34,919      55,714   34,919
Carried interest                3(b)          -        -   (6,189)  (4,737)   ( 6,189)   (4,737)
Income                          2        12,129    7,769        -        -      12,129    7,769
Investment management fee      3(a)        (840)    (730)  (2,519)  (2,191)     (3,359)  (2,921)
Other expenses                  4(a)       (669)    (636)       -        -        (669)    (636)
Return on ordinary activities 
before taxation                          10,620    6,403   47,006   27,991      57,626   34,394
Taxation on ordinary
activities                      6        (3,174)  (1,884)     756      657      (2,418)  (1,227)
Transfer to reserves                      7,446    4,519   47,762   28,648      55,208   33,167
Return per ordinary share        7        29.56p   17.94p  189.63p  113.74p     219.19p  131.68p

The total return column of this statement represents the Company's profit and
loss. The supplementary revenue and capital return columns are prepared under
guidance published by the Association of Investment Companies. All recognised
gains and losses are disclosed in the Revenue and the Capital columns of the
Income Statement and as a consequence no Statement of Total Recognised Gains
and Losses has been presented.

The movements in reserves are set out in note 17 to the financial statements.
All revenue and capital items in the above statement derive from continuing
operations.

No operations were acquired or discontinued during the year.

The notes on the following pages form part of these financial statements.

Balance sheet
as at 31 December 2007
                                                   Note      2007         2006
                                                            £'000        £'000
Fixed assets
Investments held at fair value
Quoted at market valuation                                  6,482       14,255
Unquoted at Directors' valuation                          147,885      134,287
                                                      9   154,367      148,542
Current assets
Debtors                                              11    13,906       10,005
Government securities                                12    79,723       34,284
Cash                                              13(a)       117        2,268
                                                           93,746       46,557
Creditors - amounts falling due within one year      14    (9,296)      (7,964)
Net current assets                                         84,450       38,593
Net assets                                                238,817      187,135

Capital and reserves
Called up share capital                              16     6,296        6,296
Share premium account                                17    14,123       14,123
Capital redemption reserve                           17     1,248        1,248
Capital reserve - realised                           17   197,852      152,787
Capital reserve - unrealised                         17     5,682        2,985
Revenue reserve                                      17    13,616        9,696
Total equity shareholders' funds                          238,817      187,135
Net asset value per ordinary share                    7     948.2p       743.0p

The financial statements were approved and authorised for issue by the Board of
Directors on 17 March 2008 and signed on its behalf by:

Roger Mountford, Chairman
Timothy Amies, Director

The following notes form part of these financial statements.

Cash flow statement
for the year ended 31 December 2007
                                                 Note       2007          2006
                                                           £'000         £'000
Net cash outflow from operating activities       4(b)     (2,259)       (2,273)
Taxation (paid)/recovered                                 (2,137)        2,666
Capital expenditure and financial investment
Purchase of fixed asset investments                      (50,757)      (45,266)
Proceeds from the sale of fixed asset
investments                                              103,283        59,805
Net cash inflow from capital expenditure and
financial investment                                      52,526        14,539
Equity dividends paid                                     (3,526)       (2,519)
Net cash inflow before management of liquid
resources                                                 44,604        12,413
Management of liquid resources
Purchase of government securities                       (181,486)     (111,342)
Sale/redemption of government securities                 134,731       100,334
Net cash outflow from management of liquid
resources                                                (46,755)      (11,008)
(Decrease)/increase in cash in the period          13     (2,151)        1,405


Reconciliation of movements in shareholders' funds
for the year ended 31 December 2007

                         Note    Called    Share  Capital    Capital  Revenue      Total
                                     up  premium   redemp    reserves  reserve
                                  share   Accout     tion          
                                capital           reserve                        
                                  £'000    £'000    £'000      £'000    £'000      £'000
                                      
At 31 December 2006               6,296   14,123     1,248   155,772    9,696    187,135
Net return from ordinary
activities after tax                  -        -         -    47,762    7,446     55,208
Dividends paid            8           -        -         -         -   (3,526)    (3,526)
At 31 December 2007       16,17   6,296    14,123    1,248   203,534   13,616    238,817

At 31 December 2005               6,296   14,123     1,248    127,124    7,696    156,487
Net return from ordinary
activities after tax                  -        -         -     28,648    4,519     33,167
Dividends paid            8           -        -         -          -   (2,519)    (2,519)
At 31 December 2006       16,17   6,296   14,123     1,248    155,772    9,696    187,135

The following notes form part of these financial statements.

Notes to the financial statements

1. Principal activity and accounting policies

The principal activity of the Company is that of an investment company within
the meaning of section 266 of the Companies Act 1985 and section 842 of the
Income and Corporations Taxes Act 1988.

Basis of preparation

The accounts have been prepared in accordance with applicable UK law and
Accounting Standards (GAAP) and with the Statement of Recommended Practice
'Financial Statements of Investment Trust Companies' (SORP), dated January 2003
and revised in December 2005. All of the Company's operations are of a
continuing nature.

Associated undertakings

Certain investments deemed to be associated undertakings are carried at fair
value in accordance with the Company's Investments accounting policy and
Financial Reporting Standard (FRS) 9.

Investment income and interest receivable

Income from equity investments, including taxes deducted at source, is included
in revenue by reference to the date on which the investment is quoted
ex-dividend. Where the Company elects to receive dividends in the form of
additional shares rather than cash dividends, the equivalent of the cash
dividend is recognised as income in the revenue account and any excess in the
value of the shares received over the amount of the cash dividend is recognised
in Capital reserve - realised. Interest income is accounted for on an accruals
basis. Dividends receivable on equity shares where there is no ex-dividend date
and on non-equity shares are brought into account when the Company's right to
receive payment is established.

Management fee and finance costs

The annual investment management fee and finance costs are charged 75% to
Capital reserve - realised and 25% to the revenue account.

This is in line with the board's expected split of long-term returns, in the
form of capital gains and income respectively, from the investment portfolio of
the Company.

Expenses

All expenses are accounted for on an accruals basis. All administrative
expenses, excluding the management fee, are charged wholly to the revenue
account. Expenses that are incidental to the purchase or sale of an investment
are included within the cost or deducted from the proceeds of the investment.

Foreign currency

All transactions in foreign currencies are translated into sterling at the rates
of exchange ruling at the dates of such transactions. Foreign currency assets
and liabilities at the balance sheet date are translated into sterling at the
exchange rates ruling at that date. Exchange differences arising on the
translation of foreign currency assets and liabilities are taken to Capital
reserve - realised.

Taxation

Deferred taxation is recognised in respect of all timing differences that have
originated but not reversed at the balance sheet date where transactions or
events that result in an obligation to pay more tax in the future, or the right
to pay less, have occurred at the balance sheet date. This is subject to
deferred assets only being recognised if it is considered more likely than not
that there will be suitable profits from which the future reversal of the
underlying timing differences can be deducted. Timing differences are
differences between the Company's taxable profits and its results, as stated in
the financial statements, which are capable of reversal in one or more suitable
periods.

Investments

The general principle applied is that investments should be reported at "fair
value" in accordance with FRS26 and the International Private Equity and Venture
Capital Association (IPEVCA) valuation guidelines issued jointly by the British
Venture Capital Association (BVCA) and the European Venture Capital Association
(EVCA) in February 2005.

Quoted: Quoted investments are designated as held at fair value, which is deemed
to be bid market prices.

Unquoted: Unquoted investments are also designated as held at fair value and are
valued using the following guidelines:

(i) initially, investments are valued at cost, including fees and transaction
costs;

(ii) after the receipt of the first audited financial statements following
initial investment, companies are valued on the level of maintainable earnings
and an appropriate earnings multiple. A marketability discount is applied to the
value attributable to shareholders, ranging from 20% to 30%.

(iii) where more appropriate, investments are valued with reference to their net
assets rather than earnings; and

(iv) appropriate provisions are made against all individual valuations where
necessary to reflect unsatisfactory financial performance leading to diminution
in value.

Both realised and unrealised gains and losses arising on investments are taken
to capital reserves.

Capital reserves

Capital reserve - realised

The following are accounted for in this reserve:

(i) gains and losses on the realisation of investments

(ii) losses on investments within the portfolio where there is little prospect
of realisation or recovering any value;

(iii) realised exchange differences of a capital nature; and

(iv) expenses, together with the related taxation effect, charged to this
reserve in accordance with the above policies.

Capital reserve - unrealised

The following are accounted for in this reserve:

(i) increases and decreases in the valuation of investments held at the year
end; and

(ii) unrealised exchange differences of a capital nature.

Organisational structure

In May 2003, the Company entered into a partnership agreement with HGT General
Partner Limited and MUST 4 Carry LP. A limited partnership, HGT LP, was
constituted to carry on the business of an investor with the Company being the
sole limited partner in this entity.

Under the partnership agreement, the Company made a capital commitment of its
non-cash investment portfolio to HGT LP with the result that all fixed asset
investments are now held through HGT LP. Note 9 and the Investment portfolio
present the underlying investments held in HGT LP. The income and capital
accruals relating to the investments held in HGT LP are shown in notes 11 and
14. Carried interest paid to the Founder Partner is shown on the face of the
Income Statement as it is the first charge on investment gains.

The agreement stipulates that the associated income and capital profits, after
payment of the carried interest and the General Partner share, are distributed
to the Company and consequently these amounts (including the associated cash
flows) are shown in the appropriate lines within the Income Statement, Cash Flow
Statement and the related notes.

2. Income
                                                           2007           2006
                                                          £'000          £'000
Income from investments
UK unquoted investment income                             8,305          5,370
UK dividends                                                 41             82
                                                          8,346          5,452
Other income
Gilt interest                                             3,650          2,056
Deposit interest                                            133             95
Other interest income                                         -            166
                                                          3,783          2,317
Total income                                             12,129          7,769
Total income comprises:
Dividends                                                    41             82
Interest                                                 12,088          7,687
                                                         12,129          7,769


3 (a) Investment management fee

                               Revenue return   Capital return   Total return
                             2007        2006    2007     2006    2007    2006
                            £'000       £'000   £'000    £'000   £'000   £'000
Investment
management fee                745         621   2,235    1,865   2,980   2,486
Irrecoverable
VAT thereon                    95         109     284      326     379     435
                              840         730   2,519    2,191   3,359   2,921

Details of the investment management, custodian and administration contracts are
disclosed in the Directors' report.

The investment management fee is levied quarterly in arrears. Investment
management fees are charged 75% to capital and 25% to revenue.

3 (b) Carried interest

                          Revenue return        Capital return    Total return
                        2007          2006      2007      2006    2007    2006
                       £'000         £'000     £'000     £'000   £'000   £'000
Carried
interest                   -             -     6,189     4,737   6,189   4,737

The carried interest payable ranks as a first distribution of capital gains on
the investments held in HGT LP, a limited partnership established solely to hold
the Company's investments, and is deducted prior to such gains being paid to the
Company in its capacity as Limited Partner. The gross amount of capital gains of
HGT LP during the period is shown on the Income Statement. Details of the
carried interest contract are disclosed in the Directors' report.

4. Other expenses

(a) Operating expenses
                                                                  2007    2006
                                                                 £'000   £'000

Custodian and administration fees                                  249     197
Directors' remuneration (note 5)                                   138     104
Auditors' remuneration - audit services                             32      27
- taxation and interim review                                        7       4
Other administration costs                                         243     304
The Company's total expense ratio (TER) calculated as
a percentage of average net assets and including expenses, 
after relief for taxation, was:                                   1.32%   1.45%




(b) Reconciliation of net return before taxation to net cash flow from operating
    activities
                                                              2007        2006
                                                             £'000       £'000

Total return before taxation                                57,626      34,394
Gains on investments held at fair value                    (55,714)    (34,919)
Movement on carried interest                                 1,452       1,761
Increase in accrued income                                  (5,237)     (3,613)
Decrease/(increase) in debtors                                  15         (20)
(Decrease)/increase in creditors                              (397)        385
Tax on investment income included within gross income           (4)       (261)
Net cash outflow from operating activities                  (2,259)     (2,273)


5. Directors' remuneration

The aggregate remuneration of the Directors, excluding VAT where applicable, for
the year to 31 December 2007 was £133,000 (2006: £103,500). Further information
on the Directors' remuneration is disclosed in the Directors' remuneration
report.


6. Taxation on ordinary activities

(a) Analysis of charge in the year

                                  Revenue return    Capital return   Total return
                                 2007        2006    2007     2006    2007    2006
                                £'000       £'000   £'000    £'000   £'000   £'000

Current tax:
UK corporation tax              3,174       1,896    (756)    (657)  2,418   1,239
Prior year adjustment               -         (12)      -        -       -     (12)
Total current tax (note 6(b))   3,174       1,884    (756)    (657)  2,418   1,227


(b) Factors affecting current tax charge for the period

The tax assessed for the period is lower than the standard rate of corporation
tax in the UK for a large company (30%).

The differences are explained below:
                                                                2007      2006
                                                               £'000     £'000

Revenue return on ordinary activities before taxation         10,620     6,403
UK corporation tax at 30% thereon                              3,186     1,921
Effects of:
Non taxable UK dividends                                         (12)      (25)
Tax deductible expenses in capital                              (756)     (657)
Tax relief to the capital account                                756       657
Tax in relation to the prior year                                  -       (12)
                                                                 (12)      (37)
Current revenue tax charge for the period (note 6(a))          3,174     1,884

In the opinion of the Directors the Company has complied with the requirements
of Section 842 ICTA 1988 and will therefore be exempt from corporation tax on
any capital gains made in the year.

7. Return and net asset value per ordinary share
                                                            2007          2006
Revenue and capital returns per share are shown
below and have been calculated using the following:

Net revenue attributable to equity shareholders
after taxation                                        £7,446,000    £4,519,000
Net capital gains for the year                       £47,762,000   £28,648,000
Total return                                         £55,208,000   £33,167,000
Number of shares in issue                             25,186,755    25,186,755



                            Revenue return     Capital return     Total return
                           2007        2006     2007     2006     2007     2006
Return per
ordinary share           29.56p      17.94p  189.63p  113.74p  219.19p  131.68p

The net asset value per share of 948.2p (2006: 743.0p) was calculated by
dividing equity shareholders' funds of £238,817,000 (2006: £187,135,000) by the
number of shares in issue at the year end of 25,186,755 (2006: 25,186,755).

8. Dividends on ordinary shares

Company                         Register date   Payment date   2007      2006
                                                              £'000     £'000
Final dividend (10.00p) 
for the year ended 31 
December 2005                   24 March 2006   2 May 2006        -     2,519
Final dividend (14.00p)
for the year ended 31
December 2006                   23 March 2007   1 May 2007    3,526         -

                                                              3,526     2,519

The proposed final dividend is subject to approval by shareholders at the Annual
General Meeting and has not been included as a liability in these financial
statements.

The total dividends payable in respect of the financial year, which form the
basis of the retention test as set out in section 842 of the Income and
Corporation Taxes Act 1988, are set out below:

                                                                          2007
                                                                         £'000

Revenue available for distribution by way of dividend for the year       7,446
Proposed final dividend of 25.00p for the year ended 31 December 2007   (6,297)
(based on 25,186,755 ordinary shares in issue at 31 December 2007)
Undistributed revenue for section 842 purposes *                         1,149

* Undistributed revenue comprises 9.6% of income from investments of £11,996,000
  (see note 2).

9. Investments held at fair value
                                                              2007       2006
                                                             £'000      £'000
Investments held at fair value through profit and loss
Investments quoted on the London or Dublin Stock Exchanges   2,761      3,034
Investments traded on NASDAQ                                 3,721     11,221
Unquoted investments                                       147,885    134,287
                                                           154,367    148,542
Equity shares                                               57,655     85,803
Convertible securities                                         200      1,401
Fixed income securities                                     96,512     61,338
                                                           154,367    148,542

                                           Quoted      Unquoted          Total
                                            £'000         £'000          £'000

Opening valuation as at 1 January 2007     14,255       134,287        148,542
Opening unrealised
(appreciation)/depreciation                (6,173)        2,806         (3,367)
Opening book cost                           8,082       137,093        145,175
Movements in the year:
Additions at cost                             309        50,448         50,757
Disposals - proceeds                       (5,991)      (95,971)      (101,962)
- realised gains on sales                   4,049        50,523         54,572
Closing book cost of investments            6,449       142,093        148,542
Closing unrealised appreciation                33         5,792          5,825
Closing valuation of investments as
at 31 December 2007                         6,482       147,885        154,367

The Company has equity holdings of 10% or more of the following classes of share
in the companies listed below:

Company                       Country of           Shareholding                 % of class*
                              incorporation

Addison Luxembourg SA         Germany              Class A Shares                     19.5%
Atlas Energy Group Ltd        UK                   Ordinary Shares                    58.8%
BMFCO UA                      The Netherlands      Membership Rights                  10.2%
Clarion Events Holdings Ltd   UK                   A Ordinary Shares                  17.0%
Classic Copyright (Holdings) 
Ltd                           UK                   A Ordinary Shares                  15.8%
Cornish Bakehouse
Investments Ltd               UK                   Ordinary Shares                    38.2%
Doc M SARL                    Germany              Ordinary Shares                    17.0%
Elite Holding SA              The Netherlands      Ordinary Shares                    19.3%
FTSA Holdings Ltd             UK                   Ordinary Shares                    19.5%
Hirschmann Electronics        Germany              A Redeemable Shares                12.6%
Holdings SA 
Hirschmann Electronics        Germany              C Redeemable Shares                12.6%
Holdings SA
Hofmann M.M. SA               Germany              Ordinary Shares                    15.1%
Hoseasons Group LTD           UK                   Ordinary Shares                    12.0%
Mondo Minerals Co-op          Finland              Registered Shares                  11.4%
Newchurch Ltd                 UK                   Subordinated £1 shares             11.6%
Orbiscom Ltd                  UK                   Non - Convertible                  23.0%
                                                   Redeemable Prefs
Profiad Ltd                   UK                   B Ordinary Shares                  13.9%
Rolfe and Nolan
Holdings Ltd                  UK                   Hg Preferred Ordinary              17.2%
                                                   Shares
Schenck Process SA            Germany              Ordinary Shares                    16.6%
SGI (Holdings) Ltd            UK                   A Ordinary Shares                  14.8%
Sporting Index Group Ltd      UK                   Ordinary Shares                    13.7%
The Sanctuary Spa
Holdings Ltd                  UK                   Ordinary Shares                    29.4%
W.E.T Holding Luxembourg SA   Germany              Ordinary Shares                    14.5%

* Investee companies may issue a number of different classes of share. The
percentage of the total issued ordinary share capital of the ten largest
investments held by the Company is shown in the table entitled 'top ten
investments'.

Further information on those investments which, in the opinion of the Directors,
have a significant effect on the Company's financial statements, is contained in
the Review of principal investments.

10. Gains on investments and government securities

                                                           2007           2006
                                                          £'000          £'000

Realised gains on sales                                  53,017         20,516
Foreign exchange losses                                       -             (4)
Change in unrealised appreciation                         2,697         14,407
                                                         55,714         34,919
11. Debtors
                                                           2007           2006
                                                          £'000          £'000

Sales for future settlement                                   -          1,321
Prepayments and accrued income                           13,901          8,664
Other debtors                                                 5             20
                                                         13,906         10,005

12. Government securities
                                                              2007        2006
                                                             £'000       £'000
Investments held at fair value through profit and loss
Opening valuation                                           34,284      24,515
Purchases at cost                                          181,486     111,342
Sales and redemptions                                     (134,731)   (100,334)
Movement in unrealised capital gains/(losses)                  239         (65)
Realised capital losses                                     (1,555)     (1,174)
Closing valuation                                           79,723      34,284


13. Movement in net funds

(a) Reconciliation of net cash flow to movement in net funds

                                                          2007            2006
                                                         £'000           £'000

Change in net funds                                     (2,151)          1,405
Exchange movements                                           -              (4)
Net funds at 1 January                                   2,268             867
Net funds at 31 December                                   117           2,268

(b) Analysis of changes in net funds 
                                         At 1       Cash     Exchange    At 31
                                          Jan      flows   movements       Dec
                                         2007                   2007      2007
                                        £'000      £'000       £'000     £'000

Cash                                    2,268     (2,151)          -       117

14. Creditors - amounts falling due within one year

                                                           2007           2006
                                                          £'000          £'000

Carried interest                                          6,189          4,737
Corporation taxation payable                              2,564          2,287
Sundry creditors                                            543            940
                                                          9,296          7,964

15. Risk

The following disclosures relating to the risks faced by the Company are
provided in accordance with Financial Reporting Standard 29, "Financial
instruments: disclosures".

Financial instruments and risk profile

As a private equity investment trust, the Company's primary investment objective
is to achieve long-term capital appreciation by investing in unquoted companies,
mostly in the UK and Europe. Additionally, the Company holds Government gilts
and cash and items such as debtors and creditors arising directly from its
operations. In pursuing its investment objective, the Company is exposed to a
variety of risks that could result in either a reduction of the Company's net
assets or a reduction in the profits available for distribution by way of
dividends. These risks, valuation risk, market risk (comprising currency risk
and interest rate risk) and liquidity risk and and the directors' approach to
the management of them, are set out below. The Company Secretary, in close
cooperation with the board of directors and the Manager, coordinates the
Company's risk management. The objectives, policies and processes for managing
the risks, and the methods used to manage the risks, that are set out below,
have not changed from the previous accounting period.

Valuation risk

The Company's exposure to valuation risk comprises mainly movements in the value
of its underlying investments, the majority of which are unquoted. In accordance
with the Company's accounting policies, all underlying unquoted investments are
valued by the Directors with regard to the current guidelines issued by the
International Private Equity and Venture Capital Association. The Company does
not hedge against movements in the value of these investments. The Company has
exposure to interest rate movements, through cash and gilt holdings.

In the opinion of the Directors, the diversified nature of the Company's
portfolio significantly reduces the risks of investing in unquoted companies.

Market risk

The fair value of future cash flows of a financial instrument held by the
Company may fluctuate due to changes in market prices. This market risk
comprises: currency risk (see below), interest rate risk (see following page)
and equity price risk (see following page). The Board of Directors reviews and
agrees policies for managing these risks. The Manager assesses the exposure to
market risk when making each investment decision, and monitors the overall level
of market risk on the whole of the investment portfolio on an ongoing basis.

Currency risk and sensitivity

The Company is exposed to currency risk as a result of investing in funds and
companies in foreign currencies. The sterling value, being the Company's
functional currency, of these assets can be significantly influenced by
movements in foreign exchange rates. The Company does not normally hedge against
foreign currency movements affecting the value of its investments, but takes
account of this risk when making investment decisions. The Manager monitors the
Company's exposure to foreign currencies and reports to the board on a regular
basis. The following table illustrates the sensitivity of the Revenue and
Capital return for the year in relation to the Company's year-end financial
assets for movements in foreign exchange rates against the Company's functional
currency. The rates represent the high and low positions during the year for the
currencies listed.
                                                                    
                                    Revenue return            Capital  return
                               £'000          NAV per       £'000      NAV per
                                             ordinary                 ordinary
                                                share                    share
                                               (pence)                  (pence)
Low Euro (1.3532)                  9                -         364          1.4
Norwegian Kroner (10.8223)        (1)               -         (17)        (0.1)
US Dollar (1.9180)                64              0.3         559          2.2
                                  72              0.3         906          3.5
High Euro (1.5296)              (168)            (0.7)     (6,525)       (25.9)
Norwegian Kroner (12.7668)      (148)            (0.6)     (2,118)        (8.4)
US Dollar (2.1161)              (100)            (0.4)       (875)        (3.5)
                                (416)            (1.7)     (9,518)       (37.8)


In the opinion of the Directors, the above sensitivity analyses are not
representative of the year as a whole, since the level of exposure changes
frequently as part of the currency risk management process used to meet the
Company's objectives.

Interest rate risk and sensitivity

The Company has exposure to interest rate movements as this may affect the fair
value of funds awaiting investment, interest receivable on cash and interest
payable on borrowings. The Company has little immediate direct exposure to
interest rates on its fixed assets as the majority of these are fixed rate
assets and equity shares that do not pay interest. Therefore, and given that the
Company has no borrowings and maintains low cash levels, the Company's revenue
return is not materially affected by changes in interest rates.

However, funds awaiting investment are invested in Government securities and as
stated above, the valuation is affected by movements in interest rates. The
sensitivity of the capital return of the Company to movements on interest rates
has been based on the UK base rate. With all other variables constant, a 0.5%
decrease in the above should increase the capital return for the year by
£400,000, with a corresponding decrease if the UK base rate were to increase by
0.5%. In the opinion of the Directors, the above sensitivity analyses are not
representative of the year as a whole, since the level of exposure changes as
investments are made and repaid throughout the year.

Liquidity risk

Investments in unquoted companies, which form the majority of the Company's
investments, may not be as readily realisable as investments in quoted
companies, which might result in the Company having difficulty in meeting
obligations associated with financial liabilities. Liquidity risk is currently
not significant as more than 33% of the Company's net assets at the year-end are
invested in liquid funds. The Board gives guidance to the Manager as to the
maximum amount of the Company's resources that should be invested in any one
company. For details refer to the investment policy.

Equity price risk

Equity price risk is the risk that the fair values of equities (including loans)
decrease as a result of changes in the values of individual assets. The Board of
Directors manages the risks inherent in the investment portfolios by ensuring
full and timely access to relevant information from the Manager. The Board meets
regularly and at each meeting reviews investment performance. The Board monitors
the Manager's compliance with the Company's objectives, and is responsible for
investment strategy and asset allocation. The Manager's best estimate of the
effect on the net assets and total return due to a reasonably possible change in
quoted indices and the value of unquoted securities, with all other variables
held constant, is as follows:

                                                                       NAV per
                                                                      ordinary
                                     %                                   share
                                Change             £'000               (pence)

Quoted                            10%                648                  2.6
Unquoted                          10%             14,789                 58.7
                                                  15,437                 61.3

Financial assets of the Company
 
                                     2007                                2006
                                             Non                                   Non
                       Fixed  Floating  interest              Fixed  Floating  interest  
                        rate      rate   bearing     Total     rate      rate   bearing     Total
                       £'000     £'000     £'000     £'000    £'000     £'000     £'000     £'000  

Sterling             124,958       117    21,223   146,298   72,996     2,268    28,524   103,788
Euro                  38,607         -    20,734    59,341   19,000         -    39,138    58,138
Norwegian Kroner       7,203         -     7,553    14,756    5,027         -    16,940    21,967
US dollar              5,667        -     8,145    13,812        -          -     1,201     1,201
Total                176,435       117    57,655   234,207   97,023     2,268    85,803   185,094

The fixed rate assets comprise gilts and fixed rate lendings to investee
companies. Fixed rate lendings have a weighted average interest rate of 10.9%
per annum (2006: 11.3%) and a weighted average life to maturity of 7.9 years
(2006: 6.8 years). The floating rate assets consist of cash.

The non interest-bearing assets represent the equity content of the investment
portfolio.

The Company did not have any outstanding borrowings at the year end (2006:
£nil). The numerical disclosures above exclude short-term debtors and creditors.

Currency exposure

The currency denomination of the Company's financial assets is shown above.
Short-term debtors and creditors, which are excluded, are predominantly in
sterling, the functional currency of the Company.

Capital management policies and procedures

The Company's capital management objectives are to ensure that it will be able
to finance its business as a going concern and to maximise the revenue and
capital return to its equity shareholders, through an appropriate balance of
equity capital and debt.

The Company's capital at 31 December comprises:

                                                                          2007
                                                                         £'000
Equity
Equity share capital                                                     6,296
Share premium                                                           14,123
Capital redemption reserve                                               1,248
Retained earnings and other reserves                                   217,150
Total capital                                                          238,817

As stated above, the Company did not have any outstanding borrowings at the year
end. The Board with the assistance of the Manager monitors and reviews the broad
structure of the Company's capital on an ongoing basis. This review includes:

• the planned level of gearing, which takes into account the Manager's view on
  the market;

• the need to buy back equity shares, either for cancellation or to hold in
  treasury, which takes account of the difference between the net asset value 
  per share and the share price (ie the level of share price discount or 
  premium);

• the need for new issues of equity shares, including issues from treasury; and

• the extent to which revenue in excess of that which is required to be
  distributed should be retained, whilst maintaining its Section 842 status.

The Company's objectives, policies and processes for managing capital are
unchanged from the preceding accounting period.

16. Share capital
                                                      2007                 2006
                                         Nominal     £'000     Nominal    £'000
                                         No.'000               No.'000
Authorised: 
40,000,000 ordinary shares of 25p each   40,000     10,000      40,000   10,000
Allotted, called up and fully paid:
Ordinary shares
At 1 January & 31 December               25,187      6,296      25,187    6,296

17. Share premium account and reserves

                              Share     Capital                                
                            premium      redemp      Capital       Capital      
                            account        tion      reserve       reserve      Revenue
                            reserve    realised   unrealised       Reserve
                              £'000       £'000        £'000         £'000        £'000

As at 1 January 2007         14,123       1,248      152,787         2,985        9,696
Transfer on disposal of
investments                       -           -        9,847        (9,847)           -
Losses on sale of government
securities                        -           -       (1,555)            -            -
Net gain on sale of
investments                       -           -       44,725             -            -
Net movement in unrealised
appreciation of investments       -           -            -        12,544            -
Dividends paid                    -           -            -             -       (3,526)
Net revenue for the year
after tax                         -           -            -             -        7,446
Carried interest                  -           -       (6,189)            -            -
Management fee charged to
capital, after taxation           -           -       (1,763)            -            -
As at 31 December 2007       14,123       1,248      197,852         5,682       13,616


18. Contingent liabilities

As at 31 December 2007, investment purchases of £11,900,000 (31 December 2006:
£12,941,000) had been authorised and contractually committed, including uncalled
commitment to Hg Renewable Power Partners LP.

19. VAT recoverable

On 28 June 2007 the European Court of Justice announced that it had found in
favour of the Association of Investment Companies and JPMorgan Claverhouse Trust
plc in declaring that management expenses of investment trusts should be exempt
from VAT. Her Majesty's Revenue and Customs ("HMRC") has recently announced that
it has accepted that fund management services are exempt from VAT and it has
withdrawn from the appeal in the JPMorgan Claverhouse Trust case. The Company
will therefore no longer be charged VAT on management expenses and it is
expected that it will be able to recover some or all of the VAT previously
charged on management fees. Clarification as to how claims will be processed is
awaited from HMRC. Between February 2001 and September 2007 the Company paid
approximately £2,310,000 of VAT on its management expenses. No recovery of VAT
has been recognised in respect of this or any other period in these financial
statements. The extent of any recovery will be determined by negotiation, taking
into account the VAT position of the Company's managers over the period.

Top ten investments                        
                                                                                             % of total      % of 
                                                                                                  share      total
                                                                                      income    capital
                                                                               Net   accrued       held
                           Accounting                                       assets/     2007     by the
                                 date   Currency   Turnover   PBIT*   (liabilities)    £'000    company  2007    2006

Addison Luxembourg SA          Dec-06        €'m       37.7    11.2           19.5        36      18.1%   4.9%   4.5%

Atlas Energy Group Ltd         Sep-07        £'m        5.1     2.5            2.0        69      47.1%   5.3%     -
BMFCO UA (t/a Fabory)          Dec-06        €'m      248.9    29.2            5.7       270      10.2%   7.4%     -
Clarion Events Holdings Ltd    Jan-07        £'m       47.8     6.7           (6.1)    1,740      11.0%   4.9%   3.8%
Hofmann M.M. SA                Sep-07        €'m      102.8    21.5            7.2       347      15.1%   7.0%   3.1%
Mondo Minerals Co-op           Oct-07        €'m      134.1    19.8           79.3       133      11.4%   4.8%     -
Sporting Index Group Ltd       May-07        £'m       24.3     7.8          (15.1)    2,245      13.7%   4.7%   3.7%

The Sanctuary Spa Holdings Ltd Aug-07        £'m       26.3     6.0            5.2         -      29.4%   7.5%   4.1%

Visma Holdings                 Dec-06      NOK'm    2,305.6   316.0          591.0       968       9.2%   8.9%   8.2%

Voyage Group Ltd               Mar-07        £'m      107.4    24.0          (20.7)    2,866       7.9%   5.7%   7.2%
(formerly Paragon)

* Profit Before Interest and Taxation and, where applicable, before amortisation
  of goodwill
 
This table does not form part of the financial statements.

Analysis of registered shareholders
as at 27 February 2008

By type of holder    
                                         % of total            % of total
                           Number of   27 Feb   31 Dec   Number of  27 Feb  31 Dec
                              shares     2008     2006     holders    2008    2006

Nominee companies         23,599,389     93.7     80.4         373    56.2    54.2
Direct private investors   1,112,008      4.4      7.5         241    36.3    38.2
others                       475,358      1.9     12.1          50     7.5     7.6
                          25,186,755    100.0    100.0         664   100.0   100.0

By size of holding    
                                         % of total            % of total
                           Number of   27 Feb   31 Dec   Number of  27 Feb  31 Dec
                              shares     2008     2006     holders    2008    2006

1 - 5,000                    678,805      2.7      2.9         465    70.0    67.5
5,001 - 50,000             2,277,447      9.0     10.6         128    19.3    22.2
50,001 - 100,000           1,963,355      7.8      7.1          27     4.0     3.5
over 100,000              20,267,148     80.5     79.4          44     6.7     6.8
                          25,186,755    100.0    100.0         664   100.0   100.0

This table does not form part of the financial statements.

Board of Directors

Roger Mountford (Chairman)

Aged 59, Roger Mountford was appointed to the Board in 2004 and became Chairman
in April 2005. He spent 30 years as a merchant banker in the City of London and
in the Far East, latterly as Managing Director in the Corporate Finance
Department of SG Hambros, leading the Bank's practice in the private equity
market. He now serves on several boards, including the Civil Aviation Authority,
where he is chairman of the CAA Pension Scheme, and the Port of Dover. He is
Chairman of The Housing Finance Corporation and of Enterprise LSE Limited, the
commercial subsidiary of the London School of Economics.

Timothy Amies

Aged 69, Timothy Amies was appointed to the Board in 1991. He is a chartered
accountant with over 30 years' experience of working in the City. He was a
partner at Laurie Milbank & Co, stockbrokers for 16 years prior to its
acquisition by Chase Manhattan Bank. He then became a director of Chase
Investment Bank involved in mergers and acquisitions. He is Chairman of the
Audit and Valuation Committee of the Company.

Piers Brooke

Aged 67, Piers Brooke was appointed to the Board in 2001. He worked for 38 years
in both commercial and merchant banking, holding a variety of general management
positions in the UK, Continental Europe, the Far East and North America. Most
recently he was Director of Financial Strategy at National Westminster Bank. He
is a non-executive director of Focus Solutions Group plc and Lothbury Property
Trust.

Richard Brooman

Aged 52, Richard Brooman was appointed to the Board on 11 October 2007. He is a
chartered accountant and is Deputy Chairman and Chairman of the Audit Committee
of Invesco Perpetual UK Smaller Companies Investment Trust plc. He was formerly
Chief Financial Officer of Sherwood International plc and Group Finance Director
of VCI plc. Prior to this, he served as CFO of the global Consumer Healthcare
business of SmithKline Beecham and held senior financial and operational
positions at Mars after qualifying with Price Waterhouse.

Peter Gale

Aged 52, Peter Gale was appointed to the Board in 1991 and is Deputy Chairman of
the Company. He has worked in many divisions of National Westminster Bank,
specialising in investment management. In 1990 he became responsible for the
investment management of National Westminster Bank Group Pension Funds, which
subsequently became RBS Pension Trustee Ltd. Upon the purchase of Gartmore
Investment Management plc in 1996, he became a principal of the enlarged fund
management company and in 2003 became Managing Director of Gartmore Private
Equity. He is a non-executive director of Lothbury Property Trust plc.

Andrew Murison

Aged 59, Andrew Murison was appointed to the Board in 2004. He was Senior Bursar
of Peterhouse, Cambridge for nine years and spent the previous twelve years as a
principal in private equity partnerships in the USA. Prior to that he was a fund
manager, financial journalist and investment banker in the City of London. He
now serves on the board of Aberdeen Growth Opportunities Venture Capital Trust
plc and is Chairman of the JPMorgan European Investment Trust plc.

All Directors are members of the Audit and Valuation, Nomination, Directors'
Remuneration and Management Engagement Committees.

All Directors are non-executive.





                      This information is provided by RNS
            The company news service from the London Stock Exchange

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