Hargreave Hale AIM VCT posts negative interim return amid volatility

Hargreave Hale AIM VCT PLC reported a negative net asset value total return in the first half of its financial year, as geopolitical tensions and weakening UK economic conditions weighed on AIM-listed investments.

The venture capital trust investing in AIM-listed stocks in London said its unaudited net asset value per share fell to 30.62 pence at March 31 from 36.46p at September 30.

After accounting for a final dividend of 1.00p and a special dividend of 2.00p paid in February, NAV total return for the six months to March 31 was negative 7.8%.

The company said the AIM All-Share index fell 6.0% over the period, with gains made after the UK autumn budget erased by volatility linked to the outbreak of conflict in the Middle East.

Qualifying investments reduced NAV by 2.50p per share, while non-qualifying investments were broadly unchanged.

Among the strongest performers were engineering coatings firm Hardide PLC, whose shares more than quadrupled following a series of contract wins and earnings upgrades, restaurant chain operator Tortilla Mexican Grill PLC, up 97%, and healthcare group Abingdon Health PLC, up 32%.

The largest detractors included estate agency franchisor Property Franchise Group PLC, down 28%, cloud computing provider Beeks Financial Cloud Group PLC, down 29%, and cybersecurity software firm Intercede Group PLC, down 57%.

The company said UK economic conditions remained challenging during the period, with consumer and business confidence weakened by the delayed autumn budget and subsequently by the conflict in the Middle East.

The company expects UK gross domestic product to remain subdued for the rest of the year.

The VCT ended the period 93.9% invested under HMRC qualifying investment rules. During the six months it made new investments in AIM-listed companies Vulcan Two Group PLC and KRM22 PLC, as well as private companies LabGenius Ltd and Xampla Ltd.

Post period-end, performance improved. The company said NAV per share rose 8.8% to 33.31p by May 29, while the AIM index gained 13.0% over the same period.

Shares in Hargreave Hale AIM VCT were quoted at 31.44p on Monday afternoon in London.

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