AIC VCT Seminar

Patrick Reeve – Managing Partner

31st January 2018

This presentation is issued by Albion.

This presentation is not a prospectus but is an advertisement and investors should not subscribe for any shares referred to in this presentation except on the basis of information in the Prospectus approved by the VCT boards. The Prospectus including Securities Note, Summary, Registration Document and Application Form are available on the Albion Capital website (www.albion.capital) and will exclusively form the basis of any application.

A comprehensive list of risk factors is detailed in the Prospectus and an investment should not be considered until the risksare considered fully. Albion Capital does not provide advice to, or ensure suitability in respect of any of its investment funds. The information relating to tax in this presentation should not be construed as tax advice. Current tax levels and relief areliable to change. Investors should consult their own tax adviser in relation to their individual circumstances.

This presentation is provided on a confidential basis and accordingly should not be passed, distributed, published or reproduced in whole or in part or disclosed by the recipient to any other person, whatsoever.

Albion Capital is authorised and regulated by the Financial Conduct Authority. Albion Capital acts exclusively for the VCTs and for no-one else. Investors in the VCTs will not be treated as regulatory customers of Albion Capital.

CONFIDENTIAL

• Albion Capital

• VCTs in a Changing Environment

• Portfolio

• Track Record

• The Offers

Contents

• Since its formation as VCT Manager in 1996, aimed to provide balance in a changeable political and economic environment

• Overall aim to create long-term, sustainable business

• Which in turn can create long-term, sustainable returns for its investors

• Concentrating on themes of: Sector balanceLong term growthBias towards the socially positive

1. Albion Capital (i)

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1. Albion Capital (ii)

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• 42 staff – over £1 billion under management

VCTs£360m

Albion Community

Power£65m

Albion Care Communities

£48mUCL Technology

Fund£53m

OLIM£510m

• Overview – period of rapid global transformation

• Sharp demographic changes – World getting smaller- Centres of population changing- Changes to the way we live

• Uncertain global growth – Declining productivity- Pressure on trade

• UK – Exposed – as a trading nation- Currency decline- Inflation threat

• Huge technological change e.g. – Management of data- Artificial Intelligence- Healthcare revolution

2.VCTs in a Changing Environment: (i) Geo-Economic Pressures

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Albion’s challenge as a VCT manager:

• Achieving balance and stability in a changing world

• Backing change and growth where result in value

• Bias towards positive social outcomes

• Finding optimism

2.VCTs in a Changing Environment:(ii) Geo-Economic Pressures

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• August 2017 Consultation “Financing Growth in Innovative Firms”

• Options to ensure innovative firms access long term finance

• Effectiveness and focus of existing initiatives (including VCTs) reviewed

• VCTs - long term investment vehicles - ideally suited to providing Patient Capital

2. VCTs in a Changing Environment: (iii) Patient Capital Review

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• No Change to Tax Incentives

• Increased focus on innovation and Growth

• Limited new asset-based investments

• Gradually reducing Asset Based portfolio – over 5-7 years

• Replaced by enlarged growth portfolio with a technology focus

• Portfolio risk managed through sector focus and maturity of investments

2. VCTs in a Changing Environment: (iv) Implications of Budget Statement

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3. Portfolio (i)

Investment portfolio as at 31st March 2017

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Number of unquoted businesses – c.60Investee companies typically have no external gearing

Radnor House, Twickenham

• Independent day school in Twickenham – started 2010

• Freehold site on the Thames – strong demographic area with under provision of private education

• Performing ahead of budget with c.410 pupils

Radnor House, Sevenoaks

• An established school in Sevenoaks with c.380 pupils

• Freehold, Grade 1 listed property with 30 acres

• Capacity for c.600 when mature

Mount House School, Barnet

• Independent day school in Barnet, North London

• Freehold, Grade II listed building in a 4 acre site

• Capacity for 350-400 children when mature

3. Portfolio: (ii) Education – Value £40m

Albion’s investments in the education sector focus on fee paying schools in affluent areas.

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• 75 bed care home in Cumnor Hill, Oxford60 bed care home in Hillingdon, Greater London 66 bed care home in Shinfield, Reading

• Focus on residential and nursing care including dementia care

• Provision of hotel style accommodation including a bistro, private dining room, library, cinema and hair salon

• Established partner (Berkley Care Group)

3. Portfolio: (iii) Healthcare (asset based) – Value £19m Addressing the needs of an ageing population, Albion’s care home investments target high quality sites in locations able to support privately paying residents.

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• Hydro-electricity: 3 schemes in Snowdonia and North Central Scotland

• Solar: Domestic rooftop in Cambridgeshire and Southern England

• Wind:4 wind turbines in South Wales and 1 in Scotland

• Biogas:Waste food biogas and composting plant in Perth, Scotland

3. Portfolio: (iv) Renewable energy – Value £49m

Albion’s renewable power portfolio is well diversified across proven technologies to provide lower risk, long term, inflation linked income.

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3. Portfolio: (v) Growth and Technology Portfolio- Value £105 million

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IT 50%

Life Sciences

14%

Advanced Manufacturi

ng12%

Business Services

11%

Digital Health

9%

Diagnostics4%

By Sector:

By Profitability:

Profitable30%

Unprofitable70%

• Investing in IT sector since 2001

• Bias towards B to B rather than consumer-facing

• 4 companies in Tech Track 100Grapeshot, Egress, Black Swan, Symetrica

• One of 8 VC investors with 4 or more entries

3. Portfolio: (v) IT Investment

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3. Portfolio: (vi) IT Portfolio - £52m

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Cyber/IT security

Predictive analytics/modelling

Automation/ machine learning

Payment systems

Digital media

£11.5m

£10.2m

£12.3m

£5.8m

£12.1m

3. Portfolio (vii)

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Grapeshot – Value £8.8m

• Investment – March 2014

• Digital marketing software – enables advertisers to find new audiences by placing advertisements in right context.

• Increases brand safety and return on investment for advertisers and publishers

• Dramatic growth: • 2013: £1.7m sales. £1m loss• 2017 (projected): £22m sales. £4m profit

4. Track Record

Total NAV return over one year and five years to 31 March 2017

The following graph sets out the performance of the VCTs over the 5 years to 31st March 2017 and the 12 month average to 31st March 2017, being the cumulative return for the period comprising dividends paid and change in net asset value. This does not include tax relief.

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• Invest across 5 Albion VCTs with 20 years’ track record raising up to £32m

• Participate in diversified, balanced portfolio c.£280 million across c.60 businesses

• Thematic investment strategy

• Current tax-free dividend yield of around 5.4% (equal to approximately 7.7% on net cost after tax relief)

• 10 dividends paid each year

• 30% up-front income tax relief

5. The Offers (i)

Features of the Albion Top Up Offers

Yield figures are based on the most recently announced NAVs and current annual dividend targets for the Albion VCTs as at the date of the Prospectus, and an equal investment across five VCTs.

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5. The Offers (ii)

Investment equally across portfolio of income producing VCTs:

Initial Investmente.g. £6,000

£1,200Albion

Development VCT

£1,200Albion

Enterprise VCT

£1,200Kings Arms Yard VCT

£1,200Albion

Technology & General

VCT

£1,200Crown Place

VCT

• Option to invest different amounts in individual VCTs if required

• Should a VCT reach full capacity, the default option is that investment will be spread equally across the remaining open VCTs

• £32 million fund-raising limited: currently at c.£25.5 million

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