b'Annual Report & Accounts 2022 Mercia Asset Management PLC 39Strategic reportRealised gain on disposal of investmentDuring the year, a realised gain of 9,878,000 (2021: 20,251,000) arose on the disposal of Mercias equity holding in Faradion. Total cash proceeds of 19,402,000 were received upon completion, comprising 16,309,000 from the sale of the Groups equity holding, a loan repayment of 1,500,000, loan redemption premium of 1,500,000 and loan interest of 93,000. Loan redemption premiums and interest, totalling 738,000 were converted into equity immediately prior to disposal ofthe Groups total equity holding. Under the terms of the sale agreement, 5% of the equity sale proceeds were required tobe ring-fenced for 90 days, pending any claim as to title. As expected, no claims were received and the ring-fenced proceedsof 815,000 were released on 5 April 2022.Fair value movements in investmentsYear ended Year ended 31 March 31 March2022 2021000 000Investment movements excluding cash invested and realisations:Unrealised gains on the revaluation of investments 15,122 10,773Unrealised losses on the revaluation of investments (3,737) (685)Net fair value movement 11,385 10,088Net fair value increases during the yearMovement in fair value ofThe overall tax charge for the year totalled 11,385,000 (2021: 10,088,000)deferred consideration also comprises the annual unwinding and as at 31 March 2022, the fair value ofThe VCT fund management contractsof the deferred tax liability in respect the Groups direct investment portfoliototal purchase price has a number ofof the acquisition of the VCT fund was 119,558,000 (2021: 96,220,000).contingent deferred considerationmanagement business, offset by both For the year as a whole, unrealisedelements payable over a three-yearthe impact of the enacted change in tax fair value gains arose in 10 (2021: 11)period. The total deferred considerationrate from 19% to 25% on the Groups out of the Groups 23 (2021: 23) directwas fair valued at the date of acquisitiondeferred tax liability as at 31 March investments. The largest fair valuein 2019. The charge to the income2022, and a corporation tax charge on gain was in respect of nDreams, whichstatement of 522,000 represents taxable profits over and above what accounted for 6,734,000 of the totalthe unwinding of the discount onhas been offset against the remaining (2021: 3,509,000 fair value gain inthe second deferred considerationbrought-forward tax losses.respect of AIM-listed MyHealthCheckedpayment made in December 2021plc). There were three (2021: four)(2021: 365,000). Profit and total comprehensive fair value decreases, the largest beingincome for the year2,856,000 which arose in respect ofTaxation The adjusted operating profit, net MyHealthChecked plc (2021: 439,000performance fees, realised gain on fair value decrease in Eyoto). The components of the Groups taxthe sale of Faradion and net fair charge are shown in note 10 to thevalue increases for the year as a Share-based payments charge consolidated financial statements.whole, all contributed favourably to The 1,109,000 non-cash charge (2021:The Group fully utilised its remaininga consolidated total comprehensive 543,000) arises from the net increase inhistoric trading losses during theincome of 26,100,000 (2021: the total number of issued share optionsyear, which were available to set off34,458,000). This has resulted in basic held by all employees throughout theagainst taxable profits. The scale ofearnings per Ordinary share of 5.93 Group, ranging from 31 July 2019 to the Groups recent taxable profitspence (2021: 7.83 pence).31 March 2022. (arising predominantly from net VCT performance fees and finance income) Amortisation of intangiblehas resulted in the utilisation of the assets Groups remaining historic tax losses faster than previously anticipated.The amortisation charge for the period of 2,033,000 (2021: 2,317,000) represents amortisation of the acquired intangible assets of the VCT fund management business.'