The Lemon Fool

Very sorry to hear about Maplin's difficulties. I'm reluctant to even mention this when over 2,000 people might lose their jobs but I wonder how much it will hit the ProVen VCTs. Whatever the answer I hope as many jobs as possible can be saved.

Just been looking at that.

Wearing my VCT investor hat, I'm happy to say it was already written down a long way on the balance sheet last autumn, and outside the top 20 investments, so the effect should be minimal. That's PGOO - haven't checked PVN, but I expect it's at a similarly low level.

At Aug 17 Proven had written Maplin down to 1.1% of NAV, write down of just over £1m, NAV of just over £1m. PGI had Maplin lumped in with other holdings so perhaps a smaller hit. I think we knew this was coming and as you reflect, concerns more for the staff etc.

I suspect that we have plenty more of this to come. Central banks have played with us since 2008 trying to stave off depression but the underlying problems haven't been fixed.

In particular, the casual dining restaurant sector is under pressure. We have seen the likes of Byron Hamburger, Jamie's Italian and Prezzo all do CVAs this year with the resultant loss of jobs for staff and income for landlords. Listed restaurant companies have seen big falls in share prices. Chains like Locale in the Chrysalis VCT and La Bottega in the Pembroke VCT can't be immune.

Chains like Locale in the Chrysalis VCT and La Bottega in the Pembroke VCT can't be immune.

Looking at the report for the year ending 31/10/17 from Chrysalis VCT, I see that Locale amounts to 10.7% of NAV and K10 amounts to 4.7% of NAV
And looking at the report for the half year ending 30/9/17 from Pembroke VCT I see that La Bottega amounts to 4.3% of NAV, Chilango amounts to 3.6% of NAV and Five Guys amounts to 15.5% of NAV.
My wife holds Chrysalis, and I hold Pembroke. I wish their restaurants well!

From memory, Locale and La Bottega have already had some writedowns whereas Five Guys seems to be doing well.

We usually drop in to La Bottega after arriving at Victoria Coach Station on trips to London and they seem to attract a good level of business but they have closed a few branches.

Hopefully the VCT financed restaurants will fare well, indeed they may be helped by the bigger chains cutting back on their outlet numbers.