SVM UK EMERGING FUND PLC: Half-yearly Report

SVM UK EMERGING FUND PLC                             


                                 (the "Fund")                                  
                              HALF YEARLY REPORT                               
                   (FOR THE SIX MONTHS TO 30 SEPTEMBER 2013)                   
                                                                               

A copy of the Half Yearly Report can be downloaded from the Manager's website
at www.svmonline.co.uk and a copy has also been submitted to the National
Storage Mechanism and will shortly be available for inspection at 
www.hemscott.com/nsm.do
    HIGHLIGHTS

Net asset value gained 18.4% compared to a 9.0% return in the FTSE AIM All
Share Index

Share price rose by 28.5%

Change in the benchmark for the Fund to the IMA UK All Companies Sector Average
Index
    Interim Management Report 

CHAIRMAN'S STATEMENT


Over the six months to 30 September 2013, your Fund's net asset value gained
18.4% to 63.84p, compared to a rise of 9.0% in the benchmark, the FTSE AIM All
Share Index.  The share price gained 28.5% to 55.25p.  As a result, the
discount at which the shares stand to net asset value reduced to 13.5%. 
Further progress in the share price and net asset value have been achieved in
October. 
Shareholders approved a change in the benchmark for the Fund, with effect from
30 September 2013, to the IMA UK All Companies Sector Average Index, which the
Managers believe will be a more challenging benchmark than AIM. This index
represents the performance of the average fund in the Investment Management
Association's largest sector. It represents funds which invest at least 80% of
their assets in UK equities and which have a primary objective of delivering
capital growth. 
Equity markets were strong over the period, and the Fund was fully invested. 
The portfolio emphasis on consumer sectors, property and technology was
helpful, as prospects improved for these sectors.  The best performances during
the six months came from the consumer sector; ASOS, ITV, Ted Baker, SuperGroup
and Sports Direct.  These gains were driven by good results; profitability
picking up as the UK economy recovered.  Consumer pressures have eased, with
growth in private sector pay, and a stabilisation of real take-home pay.  The
recovery in the Pound since mid year has lowered some import costs and cut
petrol prices, and the UK economy continues to perform better than the
Eurozone.  The main portfolio disappointments were in Manroy and Ophir Energy,
which have both been sold.  Portfolio investment in the UK consumer sector was
increased during the period under review.  
The portfolio emphasises businesses with a specialisation or other competitive
advantage which helps to produce growth along with stable and growing margins. 
With low financing costs, these businesses can pay down debt, restructure or
make acquisitions to enhance earnings.  Investments with these characteristics
include Thomas Cook, ITV and Mitchells & Butlers. 
Additional investment has been made in two technology businesses; Iomart Group
which is a cloud hosting business, and in WANdisco which provides wide area
networks.  Both of these are growing, scalable businesses.  Another technology
investment, Delcam, a CAD CAM software business, received a bid in November. 
The outlook for the UK consumer is improving, and many portfolio companies will
also be helped by continuing growth in the global economy.  We expect more
stimulus for the UK economy, particularly in housebuilding, encouraging growth
in the regions.  The Fund retains a focused portfolio of growth businesses,
many of which are modestly valued in comparison to their larger equivalents. 
Its aim remains to deliver long term capital growth, with lower volatility. 
The Board and Managers believe the Fund is well placed to continue to deliver
on this aim. 


    

Peter Dicks

Chairman

22 November 2013
    INVESTMENT OBJECTIVE


The investment objective of the Fund is long term capital growth from
investments in smaller and medium sized UK companies.  Its aim is to outperform
the IMA UK All Companies Sector Average Index on a total return basis. 
The Fund aims to achieve its objective and to diversify risk by investing in
shares and related instruments, controlled by a number of limits on exposures. 
Appropriate guidelines for the management of the investments, gearing and
financial instruments have been established by the Board.  Limits are expressed
as percentages of shareholders' funds, measured at market value.  
This is an abridged version of the Fund's investment policy and objective.  The
full investment policy can be found on page 11 and 12 of the Annual Report &
Accounts for the year ended 31 March 2013. 


    Financial Statements                                                            
                                                                                    
                                                                                    
                                                                                    
    Income Statement                                                                
                                                                                    
                                                                                    
                                                                                    
                                          Six months to 30       Six months to 30   
                                           September 2013         September 2012    
                                                                                    


                                   Revenue  Capital Total Revenue  Capital    
Total 
                                 £'000    £'000 £'000   £'000    £'000  
£'000 


                                                                                
                                                                                    
                                                                                    
    Net gain/(loss) on investments at                                               
    fair value through profit or loss                                               


                                         -      590   590      -   (1,403)  
(1,403) 
                                                                             
Income                                  52        -    52      15       -       
15  
                                                                             
Investment management fees               -        -     -      -         -      
  - 
                                                                             
Other expenses                        (36)      (4)  (40)    (29)       -      
(29) 


                                                                                
    Return/(loss) before finance costs                                              
    and taxation                                                                    


                                        16      586   602    (14)  (1,403)  
(1,417) 
                                                                             
Finance costs                          (5)        -   (5)     (2)        -      
(2) 


                                                                                
    Return/(loss) on ordinary                                                       
    activities before taxation                                                      


                                        11      586   597    (16)  (1,403)  
(1,419)
Taxation                                                                         
                                         -        -                      -      
  - 


                                                                                
    Return/(loss) attributable to                                                   
    ordinary shareholders                                                           


                                        11      586   597    (16)  (1,403)  
(1,419) 
                                                                             
Return/(loss) per Ordinary Share     0.18p    9.76p 9.94p (0.27p) (23.35p) 
(23.62p) 


                                                                                
                                                                                    
                                                                                    
                                                                                    
                                                                                    
    
                                                            
                                                         
                                Year ended 31 March 2013 
                                                         
                                        (audited)        
                                                         
                                Revenue  Capital    Total
                                  £'000    £'000    £'000
                                                         
                                                         


                                                     
Net loss on investments at fair                          
value through profit or loss                              
                                  -    (991)    (991) 
                                                     
Income                               50        -       50 
                                                     
Investment management fees            -        -        - 
                                                     
Other expenses                     (96)     (12)    (108) 
                                                     
Loss before finance costs and                            
taxation                                                  
                               (46)  (1,003)  (1,049) 
                                                     
Finance costs                       (6)        -      (6) 
                                                     
Loss on ordinary activities                              
before taxation                                           
                               (52)  (1,003)  (1,055) 
                                                     
Taxation                              -        -        - 
                                                     
Loss attributable to ordinary                            
shareholders                                              
                               (52)  (1,003)  (1,055) 
                                                     
Loss per Ordinary Share         (0.86p) (16.71p) (17.57p) 


                                                         
                                                         


                                                      
Total column of this statement is the profit and loss account of the Company. 
All revenue and capital items in this statement derive from continuing 
operations.
A Statement of Total Recognised Gains and Losses is not required as all gains 
and losses of the Company have been reflected in the above statement. 


    

Balance Sheet                                                                  
                                                                               
                                                    As at     As at       As at
                                                                               
                                                       30        31          30
                                                September     March   September
                                                      2013     2013        2012 
                                              
                                                                      


                                          (unaudited) (audited)  
(unaudited) 
                                                                            
                                                £'000     £'000       
£'000 
                                                                           
Fixed Assets                                                                    
                                                                           
Investments at fair value through profit or         3,732     3,248       1,905
loss                                                                            


                                                                               
                                                                               


                                                                           
Total Current Assets                                  355       200       1,734 
                                                                           
Creditors:  amounts falling due within one          (253)     (211)       (766)
year                                                                            
                                                                            
                                                                           
Net current assets                                    102      (11)         968 


                                                                               
                                                                               


                                                                           
Total assets less current liabilities               3,834     3,237       2,873 


                                                                               
                                                                               


                                                                           
Capital and Reserves                                3,834     3,237       2,873 
                                                                           
Equity shareholders' funds                          3,834     3,237       2,873 


                                                                               
                                                                               


                                                                           
Net asset value per Ordinary Share                 63.84p    53.90p      47.85p 


                                                                               
                                                                               
                                                                               
                                                                               


                                                                           
Note                                                                            
                                                                           
These are not full statutory accounts in terms of Section 435 of the Companies 
Act 2006.  Audited accounts for the year to 31 March 2013, which were          
unqualified, have been lodged with the Registrar of Companies.                  


                                                                               
                                                                               
                                                                               
    Summarised Cash Flow Statement                                                  
          
                                                                                
          
                                                                                
          
                                                                                
          


                                                Six months  Year to 31   
Six months    
                                                     to 30       March  to 
31 March    


                                                     September                  
          


                                                                  2013       
2013    


                                                          2013                  
          
                                                                                
          
                                                         £'000       £'000    
    £'000   
                                                                                
          


                                               (unaudited) (unaudited)    
(audited)    


                                                                                
          
                                                                                
          
                                                                                


      
Net cash (out)/inflow from operating activities           (53)       (467)       


     373  
                                                                                


      
Taxation                                                     2           -       


    (2)   
                                                                                


      
Capital expenditure and financial investment               137       (187)       


    395   
                                                                                


      
Servicing of finance                                       (5)         (6)       


    (2)   
                                                                                


      
Movement in cash in the period                              81       (660)       


    764   
                                                                                
          
                                                                                   
               
                                                                                


           
Summarised Reconciliation of Movement in Shareholders' Funds                     


               
                                                                                
               
                                                                                
               
                                                                                


           
For the period to 30 September 2013                                              


               
                                                                                
               
                                                                                
               
                                                                                
               
                                                     Capital                    
               
                                                                                
               
                  Share            Share          redemption                    
               


                                      Special                  Capital      
Revenue         
            capital          premium  reserve    reserve       reserve      
reserve         


                                                                                
               
                  £'000            £'000    £'000      £'000         £'000 
       £'000        
                                                                                
               
                                                                                
               
                                                                                


           
As at 1 April       300              314    5,144         27       (1,927)      
  (621)        
2013                                                                             


               
                                                                                


           
Return                -                -        -          -           586       
 11        
attributable                                                                     
           
to                                                                               
           
shareholders                                                                     


               
                                                                                


           
As at 30            300              314    5,144         27       (1,341)      
  (610)        
September 2013                                                                   


               
                                                                                
               
                                                                                
               
                                                                                
               
                                                                                
               
                                                                                


           
For the year                                                                     
           
to 31 March                                                                      
           
2013                                                                             


               
                                                                                
               
                                                                                
               
                                                                                
               
                                                                                
               
                                                                                
               
                                                    Capital                     
               
                                                                                
               
                  Share            Share         redemption                     
               


                                     Special                 Capital       
Revenue          
            capital          premium reserve    reserve      reserve       
reserve          


                                                                                
               
                                                                                
               
                                                                                
               
                  £'000            £'000   £'000      £'000        £'000   
      £'000         
                                                                                
               
                                                                                
               
                                                                                


           
As at 1 April       300              314   5,144         27        (924)        
 (569)         
2012                                                                             


               
                                                                                


           
Loss                  -                -       -          -      (1,003)        
  (52)         
attributable                                                                     
           
to                                                                               
           
shareholders                                                                     


               
                                                                                


           
As at 30            300              314   5,144         27      (1,927)        
 (621)         
September 2012                                                                   


               
                                                                                
               
                                                                                
               
                                                                                
               
                                                                                
               
                                                                                
               
                                                                                
               
                                                                                


           
For the period to 30 September 2012                                              


               
                                                                                
               
                                                                                
               
                                                                                
               
                                                    Capital                     
               
                                                                                
               
                  Share            Share         redemption                     
               


                                     Special                 Capital       
Revenue          
            capital          premium reserve    reserve      reserve       
reserve          


                                                                                
               
                  £'000            £'000   £'000      £'000        £'000   
      £'000         
                                                                                
               
                                                                                
               
                                                                                


           
As at 1 April       300              314   5,144         27        (924)        
 (569)         
2012                                                                             


               
                                                                                


           
Loss                  -                -       -          -      (1,403)        
  (16)         
attributable                                                                     
           
to                                                                               
           
shareholders                                                                     


               
                                                                                


           
As at 30            300              314   5,144         27      (2,327)        
 (585)         
September 2012                                                                   


               
                                                                                
               
                                                                                   
                            
                                                                                


                        
Investment Portfolio                                                             


                            
                                                                                
                            
                                                                                
                            
                                                                                
                            
                                         % of Net Assets Sector analysis        
                     %      
                                                         as at 30               


                        
  Ten largest    Valuation                               September 2013        
Valuation       of Net Assets
  investments                                                                    
                        
  as at 30            £000                                                     
  £000                       
  September                                                                      
                        
  2013                                                   Sector                  


                            
                                                                                
                            
                                                                                
                            
                                                                                


                        
  Stock                                                                          


                            
                                                                                


                        
  Hydrodec 8%          250                           6.5 Basic Materials         
         0           0.0
  CULS                                                                           


                            
                                                                                


                        
  Ted Baker            191                           5.0 Industrials             
       564          14.7
  PLC                                                                            


                            
                                                                                


                        
  ASOS PLC             154                           4.0 Oil and Gas             


           316           8.2
                                                                                


                        
  Thomas Cook          146                           3.8 Consumer Goods          
       370           9.6
  Group PLC                                                                      


                            
                                                                                


                        
  Tribal               132                           3.4 Consumer                
     1,357          35.4
  Group PLC                                              Services                


                            
                                                                                


                        
  Delcam PLC           132                           3.4 Healthcare              


             0           0.0
                                                                                


                        
  WANdisco             125                           3.3 Telecoms                
        33           0.9
  PLC - CFD                                                                      


                            
                                                                                


                        
  Unite Group          124                           3.2 Technology              
       576          15.0
  PLC                                                                            


                            
                                                                                


                        
  Mitchells            122                           3.2 Financials              
       516          13.5
  and Butlers                                                                    
                        
  PLC - CFD                                                                      


                            
                                                                                


                        
  Workspace            111                           2.9 Utilities               
         0           0.0
  Group PLC                                                                      


                            
                                                                                


                        
  Ten largest        1,487                         38.7   Total                  
      3,732         97.3  
  investments                                                                    


                            
                                                                                


                        
  Other              2,245                         58.6                          
                        
  investments                                                                    
                        
  (inc CFD                                                                       
                        
  margin)                                                                        


                            
                                                                                


                        
  Total              3,732                         97.3                          
                        
  investments                                                                    


                            
                                                                                


                        
  Net current        3,834                        100.0                          
                        
  assets                                                                         


                            
                                                                                
                            
                                                                                
                            
                                                                                
                            
    Risks And Uncertainties


The principal risks facing the Fund relate to the investment in financial
instruments and include market, liquidity, credit and interest rate risk. 
Additional risks faced by the Fund are investment strategy, share price
discount, accounting, legal and regulatory risk, operational, corporate
governance and shareholder relations risk, and financial risk.  The Board seeks
to mitigate and manage these risks through continuous review, policy setting
and enforcement of contractual obligations.  The Board receives both formal and
informal reports from the Managers and third party service providers addressing
these risks.  An explanation of these risks and how they are mitigated is
explained in the 2013 Annual Report, which is available on the Manager's
website: www.svmonline.co.uk.  These principal risks and uncertainties have not
changed from those disclosed in the 2013 Annual Report.
Directors' Responsibility Statement 
The Directors are responsible for preparing the Half Yearly Report in
accordance with applicable law and regulations.   
The Directors confirm that to the best of their knowledge: 
(i)          the condensed set of financial statements, which have been 
prepared in accordance with the Accounting Standards Board's statement 'Half 
Yearly Financial gives a true and fair view of the assets, liabilities, 
financial position and profit or loss of the Fund; 
(ii)         the Interim Management Report includes a fair review of the 
information required by the Disclosure and Transparency Rules DTR 4.2.7R 
(indication of important events during the first six months and description of 
principal risks and uncertainties for the remaining six months of the year); 
and DTR 4.2.8R (disclosure of related party transactions and changes therein). 
(iii)        No related party transactions have taken place during the first 
six months of the year that have materially affected the financial position of 
the Fund during the period and there have been no changes in the related party 
transactions described in the Annual Report & Accounts for the year end 31 
March 2013 that could do so. 
The Half Yearly Financial Report has not been audited or reviewed by the Fund's
auditors. 


    By Order of the Board

Peter Dicks

Chairman

22 November 2013
    Notes


1.         The results have been prepared in accordance with applicable
accounting standards and the 2009 Statement of Recommended Practice (SORP)
issued by the Association of Investment Companies.  These accounts have been
prepared in accordance with prior year accounting policies. 


    2.         Returns per share
            Return per share is based on a weighted average of 6,005,000 (2012
            - 6,005,000) ordinary shares in issue during the year.
               Total return per share is based on the total profit for the period
            of £597,000 (2012 - loss of £1,419,000).


        Capital return per share is based on net profit for the period of 
£ 


            586,000 (2012 - loss of £1,403,000).
            Revenue return per share is based on the revenue profit after
            taxation for the period of
            £11,000 (2012 loss of £16,000).
            The number of shares in issue at 30 September 2013 was 6,005,000
            (2012 - 6,005,000).
    3.         Due to the size of the Fund, the Investment Managers have waived
           their fees for the periods to 30 September 2014 and 2013.
    4.         The above figures do not constitute full accounts in terms of


       Section 435 of the Companies Act 2006.  The accounts for the year to 
31 March 
       2013, on which the auditors issued an unqualified report under 
Section 495 of 
       the Companies Act 2006, have been lodged with the Registrar of 
Companies and 
       did not contain a statement required under Section 498 of the 
Companies Act 
       2006.  The half yearly report will be available on the Managers' 
website: 
       www.svmonline.co.uk.  Copies are also available for inspection at 7 
Castle 


           Street, Edinburgh EH2 3AH, the registered office of the Fund.
    For further information, please contact:
    Colin McLean   SVM Asset Management   0131 226 6699

Roland Cross   Broadgate Mainland     020 7226 6111



END

-0- Nov/26/2013 12:25 GMT


 
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