Pires Investments : Annual Report and Financial Statements for the year ended 31 December 2021

PIRES INVESTMENTS PLC

Annual Report and Financial Statements

FOR THE YEAR ENDED 31 DECEMBER 2021

Company Information

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PIRES INVESTMENTS PLC

Review of Activities

Annual Report and Financial Statements

FOR THE YEAR ENDED 31 DECEMBER 2021

Review of Activities

Highlights

Financial highlights

• Profit achieved of £1.49 million during the period (14 months ended 31 December 2020: loss before taxation of £687,000)
• Net asset value ("NAV") of £7,223,000 as at the period end (31 December 2020: £2,926,000), an increase of 147% compared to the prior year figure, equating to an increase of circa 100% NAV per share to 4.57 pence since 31 December 2020
• NAV at the end of the period does not include the impact of the recent significant increase in valuation of Getvisibility which took place in 2022 and from which the Company benefits through both its direct and indirect holdings in this company

Portfolio highlights

• Effective interest in Sure Valley Ventures ("SVV") increased to circa 20% through the purchase of a shareholding in Sure Ventures plc ("SV plc")
• New investments made by SVV include Virtex, PreCog and Smarttech247
• Further successful funding rounds for portfolio companies include:
  o Getvisibility­ raised €1.1 million during 2021 and a further €10 million post period end o VividQ - raised £11 million
  o Ambisense - raised €3 million o Admix - raised US$25 million
  o Cameramatics raised €4 million and then a further €3.9 million
• Significant increase in the valuation of a number of portfolio companies based on new funding rounds involving third party investors
• Portfolio companies, both direct or via SVV, continue to attract international investors such as EQT, University of Tokyo, Foresight Williams Technology (a joint collaboration between Foresight Group and Williams Advanced Engineering), Business Growth Fund, Puma Investments, Japanese Miyako Capital, Austrian APEX Ventures, Silicon Valley's R42 Group, Northwell Holdings & Ventures and Alpha Intelligence Capital
• Balance of proceeds received from the sale of Artomatix
• Smarttech247, a recent portfolio investment, is actively pursuing an IPO
• New direct investment made in PreCog and follow­on investments in Getvisibility, combined with a significant increase in the valuation of Getvisibility
• Investment made in the digital assets technology sector and ultimately Pluto Digital plc

Post‐period end highlights

• Commitment to invest £5 million in the New SVV Fund alongside £50 million from the British Business Bank with scope to achieve enhanced returns compared to industry standard
• Further significant €10 million fund raise and revaluation for Getvisibility

Review of activities

The Company has had a very busy and successful 2021 with multiple new investments being made and excellent results from a number of the Company's investments resulting in a significant profit for the year and an uplift in the Company's NAV which, as previously discussed, always lags the value of the Company's investment portfolio.

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PIRES INVESTMENTS PLC

Review of Activities (continued)

Annual Report and Financial Statements

FOR THE YEAR ENDED 31 DECEMBER 2021

Investment in SVV and SV plc

In February 2021, the Company increased its exposure to SVV through the purchase of 1.5 million shares in SV plc, a listed specialist fund, from existing SV plc shareholders using new Pires shares priced at 13.6 pence as consideration. SV plc's principal investments include a 25.9% interest in SVV and a direct investment in VividQ, one of the SVV portfolio companies. As a result of this transaction, Pires achieved an aggregate (direct and indirect) interest in SVV of around 20%, which comprises its original direct 13% interest in SVV and an indirect interest of 6.5%, through its 25% shareholding in SV plc.

Within the SVV portfolio, new investments have been made in:

• Virtex, a company building a platform for the next­generation of live, immersive entertainment within the virtual reality gaming and e sports industries;
• PreCog, a security solution platform company that provides data intelligence to combat crime, terrorism and protect vulnerable people; and
• Smarttech247, a global artificial intelligence based cyber security cloud business that protects enterprises as they migrate to cloud­based IT operations. Smarttech247 is profitable with high forecast revenue growth and has over 100 technology partners, including Tanium and CrowdStrike, and 50 clients based in Europe and the US. Smarttech247 is currently pursuing a stock market listing by way of a reverse takeover transaction which is expected to complete later in the year.

Additionally, during the period, a number of the portfolio companies have been revalued upwards based on new funding rounds which have taken place at higher valuations compared to the valuation at the time of the initial investment. These companies include:

• CameraMatics raised €4 million in January 2021 in additional funding at a valuation that represents over 300% of the CameraMatics' valuation as at the time of SVV's initial investment in November 2017. The round was led by Puma Investments, a leading provider of growth capital. CameraMatics also announced a major partnership with UK transport and logistics operator Maritime Transport Ltd. The company then raised a further €3.9 million in December 2021, again on the basis of an increased valuation thereby demonstrating this company's rapid growth in value.
• Getvisibility completed a €1.1 million funding round in June 2021 at a significant premium to its previous round. This was led by Herb Hribar who was formerly CEO of Eircom, the largest telecoms group in Ireland and is currently a director of ScienceLogic, Inc, a leading provider of AI­based operations technology. Then post period end in March 2022, the company raised €10 million from new investors including Alpha Intelligence Capital, a global venture capital firm which invests in deep artificial intelligence/machine learning technology­based companies and Fortino Capital Partners, a leading B2B software venture capital and growth equity firm.
• VividQ raised new funds of £11 million in July 2021 at a significant premium to previous valuations. This funding was led by a consortium of new international investors including the University of Tokyo, Foresight Williams Technology (a joint collaboration between Foresight Group and Williams Advanced Engineering), Japanese Miyako Capital, Austrian APEX Ventures and Silicon Valley's R42 Group, with follow­on investments from SVV, University of Tokyo Edge Capital (UTEC) and Essex Innovation. SV plc has a significant direct investment in VividQ thereby providing Pires with an increased interest in VividQ through its shareholding in SV plc.

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