TIDMNAS
RNS Number : 5097M
North Atlantic Smlr Co Inv Tst PLC
15 September 2023
North Atlantic Smaller Companies Investment Trust plc
Half-Yearly Report for the six months ended 31 July 2023
Registered in England and Wales number 1091347
objective of the company and financial highlights
North Atlantic Smaller Companies Investment Trust plc is a
company incorporated and registered in England and Wales.
The objective of the Company is to provide capital appreciation
through investment in a portfolio of smaller companies principally
based in countries bordering the North Atlantic Ocean.
31 July 31 January
2023 2023 %
(unaudited) (audited) Change
------------------------------------------------- -------------- ----------- --------
Net asset value ("NAV") per 5p Ordinary Share*:
Basic and diluted 4,929p 5,097p (3.3)
Basic and diluted adjusted# 5,174p 5,236p (1.2)
Mid-market price of the 5p Ordinary Shares 3,900p 3,900p -
Discount to net asset value 20.9% 23.5%
Discount to adjusted net asset value 24.6% 25.5%
Standard & Poor's 500 Composite Index 3,569.00 3,307.30 7.9
Russell 2000 Index 1,557.90 1,567.40 (0.6)
Ongoing charges (annualised) 1.2% 1.4%
* Includes current period.
# Adjusted to reflect Oryx International Growth Fund plc
("Oryx") under the equity method of accounting, which is how the
Company previously accounted for its share of Oryx, prior to the
adoption of IFRS 10. This is useful to the shareholder as it shows
the NAV based on valuing Oryx at NAV. See note 6.
Sterling adjusted.
chief executive's review
During the six months under review the net asset value fell by
1.2% due entirely to the fall in the dollar relative to sterling of
4.4%. The Standard & Poors Dollar Adjusted Index rose almost
entirely due to seven large megacaps to which the portfolio had no
exposure.
Performance compared against appropriate UK indices where the
majority of the portfolio is invested remains favourable.
The Trust reported net income for the period of GBP4,615,000
(2022 GBP462,000 loss). Consistent with prior years, no dividend is
being declared at this stage although the Board intends to declare
an interim dividend in February when the results for the year
become clearer. Based on current expectations, it is anticipated
that dividends in respect of the financial year ending January 2024
will comfortably exceed that paid in respect of fiscal 2023.
During the six month period the Trust purchased approximately
95,000 shares for cancellation at a discount to NAV of
approximately 25%. This policy which is ongoing increased the net
asset value for all long term shareholders and helped to modestly
reduce the discount compared to the end January 2023 net asset
value at a time when many other trusts, particularly those with
unquoted holdings, have seen a significant widening.
quoted portfolio
The market for quoted investments has been particularly tough
over the past six months as evidenced by the weakness in the
various small cap indices. The reasons for this are numerous but
can be summed up as follows: weak economic growth, rising interest
rates and very significant redemptions in small cap funds with
negligible retail demand. It is therefore pleasing to note that the
quoted portfolio significantly outperformed falling by about
3%.
Oryx and Odyssean taken together rose modestly, helped in
particular by encouraging performance in Oryx. The Trust's stand
out success stories were NIOX which rose by 75% following multiple
earnings upgrades and Sureserve rising over 40% following a
successful takeover.
The principal disappointment was EKF which fell 30% as the
business repositions itself post COVID. Fund management stocks were
also disappointing with Assetco in particular notably weak. In the
United States Mountain Commerce fell 35% following turmoil in the
banking industry. Despite the fall the bank continues to perform
well with negligible bad debt.
unquoted portfolio
Despite industry wide concerns relating to unquoted investments,
the portfolio continued to perform well during the period mainly
due to our zero exposure to technology stocks. Taken as a whole,
the unquoted portfolio added approximately GBP7m to the value of
the Fund with the standout performance coming from Spring
(following outstandingly good results) +80% and Harwood Private
Equity V +8%.
Taken as a whole, the private equity funds continue to perform
well and should create further uplifts combined with significant
cash inflow into the Trust during the balance of the year.
conclusion
At the end of June 2023 the Trust had approximately GBP107m in
cash broadly in line with the January 2023 position despite the
weakness in the dollar. We continue to believe that there is
significant value in our portfolio which should be well placed to
weather the very difficult economic environment facing the UK.
A number of our unquoteds are in a sale process which should
support increases in both net asset value per share and liquidity
as the year progresses.
Finally, the Trust's substantial cash reserves will enable it to
benefit from a more benign investing environment in the future.
C H B Mills
Chief Executive
14 September 2023
top ten investments as at 31 July 2023
Fair
value % of
GBP'000 net assets
----------------------------------------- ------------------- --------- ------------
Oryx International Growth Fund Limited* UK Listed 81,494 12.2
US Treasury Bills US Treasury Stock 80,612 12.1
Harwood Private Equity Fund V LP UK Unquoted 49,015 7.4
Polar Capital Holdings plc UK Quoted on AIM 33,950 5.1
Hargreaves Services Plc UK Quoted on AIM 29,903 4.5
Ten Entertainment Group plc UK Listed 29,500 4.4
EKF Diagnostics Holdings plc UK Quoted on AIM 25,680 3.9
Odyssean Investment Trust Plc UK Listed 25,440 3.8
Niox Group UK Listed 25,350 3.8
MJ Gleeson Group plc UK Listed 23,045 3.5
--------- ------------
403,989 60.7
--------- ------------
* Traded price under IFRS 10, incorporated in Guernsey.
All investments are valued at fair value.
interim management report
investment objective
The objective of North Atlantic Smaller Companies Investment
Trust PLC is to provide capital appreciation to its shareholders
through investing in a portfolio of smaller companies which are
principally based in countries bordering the North Atlantic
Ocean.
material events
The decline in COVID testing has had a material impact on some
of the Company's investments, and the war in Russia has created
inflation which has impacted markets in the UK and elsewhere.
material transactions
There were no material transactions during the period.
risk profile
The principal risks and uncertainties for the remaining six
months of the year continue to be as described in the Annual Report
for the year ended 31 January 2022. The principal risks arising
from the Company's financial instruments are market price risk,
including currency risk, interest rate risk and other price risk,
liquidity risk and credit risk. The Directors review and agree
policies with the Manager, Harwood Capital LLP, for managing these
risks. The policies have remained substantially unchanged in the
six months since the year end.
The Company does not have any significant exposure to credit
risk arising from any one individual party. Credit risk is spread
across a number of counterparties, each having an immaterial effect
on the Company's cash flows, should a default happen. The Company
assesses the credit worthiness of its debtors from time to time to
ensure that they are neither past due or impaired.
To support its investment in unquoted companies, the Company may
periodically agree to guarantee all or part of the borrowings of
investee companies. Provision is made for any costs that may be
incurred when the Directors consider it likely that the guarantee
will crystallise.
The Company's exposure to market price risk comprises mainly
movements in the value of the Company's investments. It should be
noted that the prices of options tend to be more volatile than the
prices of the underlying securities. The Manager assesses the
exposure to market risk when making each investment decision and
monitors the overall level of market risk on the whole of the
investment portfolio on an ongoing basis.
The functional and presentational currency of the Company is
Sterling, and therefore, the Company's principal exposure to
foreign currency risk comprises investments priced in other
currencies, principally US Dollars.
The Company invests in equities and other investments that are
realisable.
related party transactions
These are listed in note 9 to the half yearly condensed
financial statements on page --.
By Order of the Board
Sir Charles Wake
Chairman
14 September 2023
responsibility statement
The Directors confirm to the best of their knowledge that:
-- The condensed set of financial statements contained within
this half yearly financial report have been prepared in accordance
with International Accounting Standard ("IAS") 34 'Interim
Financial Reporting' in conformity with the requirement of the
Companies Act 2006 and gives a true and fair view of the assets,
liabilities, financial position and profit of the Company; and
-- The half yearly financial report includes a fair review of
the information required by the FCA's Dis-closure and Transparency
Rule 4.2.7R being disclosure of important events that have occurred
during the first six months of the financial year, their impact on
the condensed set of financial statements and a description of the
principal risks and uncertainties for the remaining six months of
the year; and
-- The half yearly financial report includes a fair review of
the information required by the Disclosure and Transparency Rule
4.2.8R being disclosure of related party transactions during the
first six months of the financial year, how they have materially
affected the financial position of the Company during the period
and any changes therein.
The half yearly financial report was approved by the Board on 14
September 2023 and the above responsibility statement was signed on
its behalf by:
Sir Charles Wake
Chairman
14 September 2023
condensed statement of comprehensive income (unaudited)
Six months ended Six months ended Year ended
31 July 31 July 31 January
2023 2022 2023
Revenue Capital Total Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------------- -------- -------- -------- -------- --------- --------- -------- -------- --------
Income 8,922 - 8,922 4,311 - 4,311 14,068 - 14,068
Net losses on investments
at fair value - (27,643) (27,643) - (112,555) (112,555) - (99,450) (99,450)
Currency exchange
(losses)/gains - (669) (669) - 3,805 3,805 - 3,954 3,954
-------- -------- -------- -------- --------- --------- -------- -------- --------
total income 8,922 (28,312) (19,390) 4,311 (108,750) (104,439) 14,068 (95,496) (81,428)
Expenses
Investment management fee
(note 9) (3,561) - (3,561) (3,976) - (3,976) (8,000) - (8,000)
Other expenses (731) - (731) (780) - (780) (1,560) - (1,560)
-------- -------- -------- -------- --------- --------- -------- -------- --------
return before taxation 4,630 (28,312) (23,682) (445) (108,750) (109,195) 4,508 (95,496) (90,988)
Taxation (15) - (15) (17) - (17) (50) - (50)
-------- -------- -------- -------- --------- --------- -------- -------- --------
return for the period 4,615 (28,312) (23,697) (462) (108,750) (109,212) 4,458 (95,496) (91,038)
-------- -------- -------- -------- --------- --------- -------- -------- --------
earnings per ordinary
share (note 5)
Basic and diluted (174.9p) (799.4p) (666.8p)
The total column of the statement is the Statement of
Comprehensive Income of the Company prepared in accordance with
International Financial Reporting Standards ("IFRS") in conformity
with the requirement of the Companies Act 2006.
The supplementary revenue and capital columns are presented for
information purposes as recommended by the Statement of Recommended
Practice ("SORP") issued by the Association of Investment Companies
("AIC").
All items in the above Statement derive from continuing
operations. No operations were acquired or discontinued in the
period.
The accompanying notes are an integral part of these financial
statements.
condensed statement of changes in equity (unaudited)
Capital
Share redemption Share Capital Revenue
capital reserve premium reserve reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------------- --------- ------------- --------- ---------- --------- ----------
six months ended 31 July 2023
31 January 2023 680 190 1,301 685,504 5,681 693,356
Total comprehensive income for the period - - - (28,312) 4,615 (23,697)
Shares purchased for cancellation (4) 4 - (2,828) - (2,828)
--------- ------------- --------- ---------- --------- ----------
31 July 2023 676 194 1,301 654,364 10,296 666,831
--------- ------------- --------- ---------- --------- ----------
six months ended 31 July 2022
31 January 2022 683 187 1,301 783,080 4,215 789,466
Total comprehensive income for the period - - - (108,750) (462) (109,212)
Shares purchased for cancellation - - - - - -
--------- ------------- --------- ---------- --------- ----------
31 July 2022 683 187 1,301 674,330 3,753 680,254
--------- ------------- --------- ---------- --------- ----------
year ended 31 January 2023
31 January 2022 683 187 1,301 783,080 4,215 789,466
Total comprehensive income for the year - - - (95,496) 4,458 (91,038)
Shares purchased for cancellation (3) 3 - (2,080) - (2,080)
Dividend - - - - (2,992) (2,992)
--------- ------------- --------- ---------- --------- ----------
31 January 2023 680 190 1,301 685,504 5,681 693,356
--------- ------------- --------- ---------- --------- ----------
The accompanying notes are an integral part of these financial
statements.
condensed balance sheet (unaudited)
As at As at As at
31 July 31 July 31 January
2023 2022 2023
GBP'000 GBP'000 GBP'000
------------------------------------------------------------ --------- --------- ------------
non current assets
Investments at fair value through profit or loss 635,150 647,425 685,491
--------- --------- ------------
635,150 647,425 685,491
current assets
Trade and other receivables 6,329 2,927 2,553
Cash and cash equivalents 27,699 34,723 9,010
--------- --------- ------------
34,028 37,650 11,563
--------- --------- ------------
total assets 669,178 685,075 697,054
--------- --------- ------------
current liabilities
Trade and other payables (2,347) (4,821) (3,698)
--------- --------- ------------
total liabilities (2,347) (4,821) (3,698)
--------- --------- ------------
total assets less current liabilities 666,831 680,254 693,356
--------- --------- ------------
net assets 666,831 680,254 693,356
--------- --------- ------------
represented by:
Share capital 676 683 680
Capital redemption reserve 194 187 190
Share premium account 1,301 1,301 1,301
Capital reserve 654,364 674,330 685,504
Revenue reserve 10,296 3,753 5,681
--------- --------- ------------
total equity attributable to equity holders of the company 666,831 680,254 693,356
--------- --------- ------------
net asset value per ordinary share (note 6):
Basic and diluted 4,929p 4,980p 5,097p
The accompanying notes are an integral part of these financial
statements.
condensed cash flow statement (unaudited)
Six months ended Six months ended Year ended
31 July 31 July 31 January
2023 2022 2023
GBP'000 GBP'000 GBP'000
----------------------------------------------------------------- ---------------- ---------------- -----------
cash flows from operating activities
Investment income received 6,752 2,961 12,903
Deposit interest received 96 16 152
Investment Manager's fees and performance fees paid (3,517) (4,025) (8,025)
Other cash payments (876) (600) (1,356)
---------------- ---------------- -----------
cash received/(expended) from operations (note 7) 2,455 (1,648) 3,674
Taxation paid (15) (17) (50)
---------------- ---------------- -----------
net cash inflow/(outflow) from
operating activities 2,440 (1,665) 3,624
---------------- ---------------- -----------
cash flows from investing activities
Purchases of investments (204,318) (230,835) (592,922)
Sales of investments 227,331 186,930 520,245
---------------- ---------------- -----------
net cash inflow/(outflow) from investing activities 23,013 (43,905) (72,677)
---------------- ---------------- -----------
cash flows from financing activities
Dividend paid (2,992) - -
Repurchase of Ordinary Shares for cancellation (2,828) - (2,080)
---------------- ---------------- -----------
net cash outflow from financing activities (5,820) - (2,080)
---------------- ---------------- -----------
increase/(decrease) in cash and cash equivalents for the period 19,633 (45,570) (71,133)
cash and cash equivalents at the start of the period 9,010 76,029 76,029
Revaluation of foreign currency balances (944) 4,264 4,114
---------------- ---------------- -----------
cash and cash equivalents at the end of the period 27,699 34,723 9,010
---------------- ---------------- -----------
The accompanying notes are an integral part of these financial
statements.
notes to the financial statements (unaudited)
1. a) basis of accounting
North Atlantic Smaller Companies Investment Trust plc is a
company incorporated and registered in England and Wales. The
principal activity of the Company is that of an investment trust
company within the meaning of Sections 1158/1159 of the Corporation
Tax Act 2010.
The condensed financial statements of the Company have been
prepared in accordance with International Accounting Standard
("IAS") 34 - "Interim Financial Reporting" in conformity with the
requirement of the Companies Act 2006. The accounting policies and
methods of computation followed in these half-yearly condensed
financial statements are consistent with the most recent annual
financial statements for the year ended 31 January 2023 included in
the Annual Report.
The financial statements have also been prepared in accordance
with the AIC SORP for the financial statements of investment trust
companies and venture capital trusts, except to any extent where it
is not consistent with the requirements of IFRS.
The financial information contained in this Half-Yearly Report
does not constitute statutory accounts as defined in the Companies
Act 2006. The financial information for the periods ended 31 July
2023 and 31 July 2022 have not been audited or reviewed by the
Company's Auditor. The figure and financial information for the
year ended 31 January 2023 are an extract from the latest published
audited financial statements, which have been filed with the
Registrar of Companies. The report of the Auditor on those
financial statements was unqualified and did not contain a
statement under either Section 498(2) or 498(3) of the Companies
Act 2006.
b) functional currency
The functional currency of the Company is Pounds Sterling
because this is the primary economic currency in which the Company
operates. The financial statements are presented in Pounds Sterling
rounded to the nearest thousand, except where otherwise
indicated.
c) significant accounting policies
The accounting policies applied are consistent with those of the
Annual Financial Report for the year ended 31 January 2023. Since
the year end no new standards have been adopted.
d) accounting developments
In the current period, the Company has applied a number of
amendments to IFRS, issued by the IASB mandatorily effective for an
accounting period that begins on or after 1 January 2023. These
include annual improvements to IFRS, changes in standards,
legislative and regulatory amendments, changes in disclosure and
presentation requirements. The adoption of these has not had any
material impact on these condensed financial statements.
e) segmental reporting
The Directors are of the opinion that the Company is engaged in
a single segment of business, being investment business. The
Company invests in smaller companies principally based in countries
bordering the North Atlantic Ocean.
f) going concern
The financial statements have been prepared on a going concern
basis and on the basis that approval as an investment trust company
will continue to be met. The Directors have made an assessment of
the Company's ability to continue as a going concern and are
satisfied that the Company has the resources to continue in
business for the foreseeable future, being a period of 12 months
from the date when these financial statements were approved. The
longer-term economic effects of the pandemic are very difficult to
predict but in considering preparing the accounts on a going
concern basis the Directors noted the Company holds a portfolio of
liquid investments whose value is a multiple of liabilities. The
Directors are of the view that the Company can meet its obligations
as and when they fall due. The cash and US treasury bills available
enables the Company to meet any funding requirements and finance
future additional investments. The Company is a closed-end fund,
where assets are not required to be liquidated to meet day-to-day
redemptions.
2. investment management and performance fees
A Performance Fee is only payable if the investment portfolio,
including Oryx at the adjusted price, outperforms the Sterling
adjusted Standard & Poor's 500 Composite Index at the end of
each financial year and is limited to a maximum payment of 0.5% of
Shareholders' Funds, and is allocated 100% to capital.
An amount would be included in these financial statements for
the Performance Fee that could be payable based on investment
performance to 31 July 2023. At that date, no Performance Fee,
inclusive of VAT, has been accrued for in the accounts (31 July
2022: GBPnil; 31 January 2023: GBPnil).
Further details of fees paid to the investment manager can be
found in Note 9, Related Party transactions.
3. taxation
The Company has an effective tax rate of 0%. The estimated
effective tax rate is 0% as investment gains are exempt from tax
owing to the Company's status as an Investment Trust and there is
expected to be an excess of management expenses over taxable income
and thus there is no charge for corporation tax.
During the half year to 31 July 2023, the Company recognised a
total charge of GBP15,000 (half year to 31 July 2022: GBP17,000,
year ended 31 January 2023: GBP50,000), representing irrecoverable
withholding tax paid on overseas investment income.
4. dividends
For the year ended 31 January 2023, the Board declared an
interim dividend of 22p per Ordinary share (31 January 2022: nil)
which was paid on 24 February 2023. For the year end 31 January
2023, no final dividend was proposed (31 January 2022; nil).
5. earnings per ordinary share
Revenue Capital Total
Net Per Net Per Net Per
return Ordinary Share return Ordinary Share return Ordinary Share
GBP'000 Shares pence GBP'000 Shares pence GBP'000 Shares pence
------------------------ -------- ---------- ------ --------- ---------- ------- --------- ---------- -------
six months ended 31
July 2023
Basic and diluted
return per Share 4,615 13,546,346 34.1 (28,312) 13,546,346 (209.6) (23,697) 13,546,346 (174.9)
-------- ---------- ------ --------- ---------- ------- --------- ---------- -------
six
months ended 31 July
2022
Basic and diluted
return per Share (462) 13,661,000 (3.4) (108,750) 13,661,000 (796.0) (109,212) 13,661,000 (799.4)
-------- ---------- ------ --------- ---------- ------- --------- ---------- -------
year ended 31 January
2023
Basic and diluted
return per Share 4,458 13,653,763 32.6 (95,496) 13,653,763 (699.4) (91,038) 13,653,763 (666.8)
-------- ---------- ------ --------- ---------- ------- --------- ---------- -------
Basic return per Ordinary Share has been calculated using the
weighted average number of Ordinary Shares in issue during the
period.
6. net asset value per ordinary share
The basic net asset value per Ordinary Share is based on net
assets of GBP666,831,000 (31 July 2022: GBP680,254,000; 31 January
2023: GBP693,356,000) and on 13,527,634 Ordinary Shares (31 July
2022: 13,661,000; 31 January 2023: 13,602,068) being the number of
Ordinary Shares in issue at the period end.
During the period to 31 July 2023, there were 74,434 shares
bought back for cancellation at a cost, including stamp duty of
GBP2,828,000 (31 July 2022: no shares bought back for cancellation;
31 January 2023: 58,932 shares at a cost, including stamp duty of
GBP2,080,000).
adjustment for Oryx
The Company has also reported an adjusted net asset value per
share using equity accounting, in accordance with its previous
method of valuing its investment in Oryx. The Company has chosen to
report this net asset value per share to show the difference
derived if equity accounting were to be used. Equity accounting
permits the use of net asset value pricing for listed assets which
in the case of Oryx is higher than its fair value.
The values of Oryx, as at each period end, are as follows:
31 July 2023 GBP'000 31 July 2022 GBP'000 31 January 2023 GBP'000
---------------------------------------------- --------------------- --------------------- ------------------------
Oryx at Fair value (traded price) 81,494 89,207 91,819
Oryx value using Equity Accounting 114,534 107,270 110,625
Increase in net assets using Equity
Accounting 33,040 18,063 18,806
31 July 2023 31 July 2022 31 January 2023
------------------------------------ ------------- ------------- ----------------
Net asset value per Share
- Basic and diluted 4,929p 4,980p 5,097p
Net asset value per Share adjusted
- Basic and diluted 5,174p 5,112p 5,236p
7. reconciliation of total return before taxation to cash
expended from operations
Six months Six months
ended ended Year ended
31 July 2023 31 July 2022 31 January 2023
GBP'000 GBP'000 GBP'000
----------------------------------------------- -------------- -------------- -----------------
Total return before taxation (23,682) (109,195) (90,988)
Losses on investments 28,312 108,750 95,496
Increase in debtors and accrued income (2,074) (1,379) (1,005)
(Decrease)/increase in creditors and accruals (101) 176 171
-------------- -------------- -----------------
Cash expended from operations 2,455 (1,648) 3,674
-------------- -------------- -----------------
8. investments
financial assets at fair value through profit or loss
This requires the Company to classify fair value measurements
using a fair value hierarchy that reflects the significance of the
inputs used in making the measurements. The fair value hierarchy
consists of the following three levels:
-- Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.
-- Level 2 - Inputs other than quoted prices included within
Level 1 that are observable for the asset or liability, either
directly (that is, as prices) or indirectly (that is, derived from
prices).
-- Level 3 - Inputs for the asset or liability that are not
based on observable market data (unobservable inputs).
The level in the fair value hierarchy within which the fair
value measurement is categorised in its entirety is determined on
the basis of the lowest level input that is significant to the fair
value measurement in its entirety.
For this purpose, the significance of an input is assessed
against the fair value measurement in its entirety. If a fair value
measurement uses observable inputs that require significant
adjustment based on unobservable inputs, that measurement is a
Level 3 measurement. Assessing the significance of a particular
input to the fair value measurement in its entirety requires
judgement, considering factors specific to the asset or
liability.
The determination of what constitutes 'observable' requires
significant judgement by the Company. The Company considers
observable data from investments actively traded in organised
financial markets; fair value is generally determined by reference
to Stock Exchange quoted market bid prices at the close of business
on the Balance Sheet date, without adjustment for transaction costs
necessary to realise the asset.
The table below sets out fair value measurements as at the
period end, by the level in the fair value hierarchy into which the
fair value measurement is categorised.
six months ended 31 July Level
2023 Total Level 1 2 Level 3
GBP'000 GBP'000 GBP'000 GBP'000
---------------------------- --------- --------- --------- ---------
Equity investments at fair
value 524,318 412,203 - 112,115
Fixed interest investments
at fair value 110,832 80,612 - 30,220
--------- --------- --------- ---------
Total 635,150 492,815 - 142,335
--------- --------- --------- ---------
six months ended 31 July Total Level 1 Level Level 3
2022 GBP'000 GBP'000 2 GBP'000
GBP'000
---------------------------- --------- --------- --------- ---------
Equity investments at fair
value 526,771 449,256 - 77,515
Fixed interest investments
at fair value 120,654 102,358 - 18,296
--------- --------- --------- ---------
Total 647,425 551,614 - 95,811
--------- --------- --------- ---------
year ended 31 January 2023 Total Level 1 Level Level 3
GBP'000 GBP'000 2 GBP'000
GBP'000
---------------------------- --------- --------- --------- ---------
Equity investments at fair
value 553,609 450,094 - 103,515
Fixed interest investments
at fair value 131,882 100,413 - 31,469
--------- --------- --------- ---------
Total 685,491 550,507 - 134,984
--------- --------- --------- ---------
reconciliation of level 3 movement - financial assets at 31 July
2023
Total Equity investments Fixed interest investments
GBP'000 GBP'000 GBP'000
--------------------------------------------------------- --------- ------------------- ---------------------------
Opening fair value at 31 January 2023 134,984 103,515 31,469
Purchases 3,083 2,882 201
Sales (43) (43) -
Total gains included in gains on investments in the
statement of comprehensive income:
- on assets sold (442) (290) (152)
- on assets held at the end of the period 4,753 6,051 (1,298)
--------- ------------------- ---------------------------
Closing fair value 142,335 112,115 30,220
--------- ------------------- ---------------------------
unquoted at directors' estimate of fair value
Unquoted investments are valued in accordance with the
International Private Equity and Venture Capital Valuation ("IPEV")
Guidelines. Their valuation incorporates all factors that market
participants would consider in setting a price. The primary
valuation techniques employed to value the unquoted investments are
earnings multiples, recent transactions and the net asset basis.
Valuations in local currency are translated into Sterling at the
exchange rate ruling on the Balance Sheet date.
Included within the Statement of Comprehensive Income as at 31
July 2023, is a gain of GBP5,018,000 relative to the movement in
the fair value of the unquoted investments valued using IPEV
valuation techniques.
the valuation techniques applied are based on the following
assumptions:
Unquoted investments are usually valued by reference to the
valuation multiples of similar listed companies or from
transactions of similar businesses. Where appropriate discounts are
then applied to those comparable multiples to reflect differences
in size and liquidity. These enterprise values are then adjusted
for net debt to arrive at an equity valuation. Where companies are
in compliance with the loan note terms these loans are generally
held at par plus accrued interest (where applicable) unless the
enterprise value suggests that the debt cannot be recovered.
9. related party transactions
There have been no changes to the related party arrangements or
transactions as reported in the Statutory Annual Financial Report
for the year ended 31 January 2023.
The Administrator, Harwood Capital LLP, is regarded as a related
party of the Company. The amounts incurred by Harwood Capital LLP
and Growth Financial Services Limited in respect of investment
management for the period are as follows:
Six months ended Six months ended Year ended
31 July 2023 31 July 2022 31 January 2023
GBP'000 GBP'000 GBP'000
--------------------------------- ----------------- ----------------- -----------------
Fees due to Harwood Capital LLP 2,137 2,376 4,800
Fees due to GFS 1,424 1,600 3,200
Performance fee - - -
Irrecoverable VAT thereon - - -
Irrecoverable VAT thereon - PYA - - -
----------------- ----------------- -----------------
3,561 3,976 8,000
----------------- ----------------- -----------------
At 31 July 2023, GBP356,000 was payable to Harwood Capital in
respect of outstanding management fees (31 July 2022: GBP376,000,
31 January 2023: GBP400,000). At 31 July 2023, there was no fee
payable to GFS in respect of outstanding performance fees (31 July
2022: GBPnil, 31 January 2023: GBPnil) net of VAT.
Fees paid to Directors, for the six months ended 31 July 2023
amounted to GBP97,000 (six months ended 31 July 2022: GBP79,000;
year ended 31 January 2023: GBP170,000).
At 31 July 2023, GBP18,000 was payable to Directors in respect
of outstanding fees (31 July 2022: GBP13,000, 31 January 2023
GBP16,000).
shareholder information
financial calendar
Announcement of results and annual report May
Annual General Meeting June
Half Yearly figures announced September
Half Yearly Report posted September
share price
The Company's mid-market share price is quoted daily in the
Financial Times appearing under "Investment Companies".
It also appears on:
SEAQ Ordinary Shares: NAS
Trustnet: www.trustnet.com
net asset value
The latest net asset value of the Company can be found on the
Company's website: www.nascit.co.uk
share dealing
Investors wishing to purchase more Ordinary Shares or dispose of
all or part of their holding may do so through a stockbroker. Many
banks also offer this service.
The Company's registrars are Link Group. In the event of any
queries regarding your holding of shares, please contact the
registrars on: 0871 664 0300, or by email on
enquiries@linkgroup.co.uk
Changes of name or address must be notified to the registrars in
writing at:
Link Group
10(th) Floor
Central Square
29 Wellington Street
Leeds LS1 4DL
Directors
Sir Charles Wake (Chairman)
Christopher Mills (Chief Executive)
Lord Howard of Rising
G Walter Loewenbaum
Peregrine Moncreiffe
Administrator
Harwood Capital LLP
(Authorised and regulated by the Financial Conduct
Authority)
6 Stratton Street
Mayfair
London W1J 8LD
Telephone: 020 7640 3200
Financial Adviser and Stockbroker
Winterflood Investment Trusts
The Atrium Building
Cannon Bridge
25 Dowgate Hill
London EC4R 2GA
Registered Office
6 Stratton Street
Mayfair
London W1J 8LD
Telephone: 020 7640 3200
Registrars
Link Group
10(th) Floor
Central Square
29 Wellington Street
Leeds LS1 4DL
Auditors
RSM UK Audit LLP
25 Farringdon Street
London EC4A 4AB
Company Secretary
SGH Company Secretaries Limited
60 Gracechurch Street
London EC3V 0HR
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END
IR EZLFFXKLEBBB
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