TIDMNAS
RNS Number : 6194Z
North Atlantic Smlr Co Inv Tst PLC
20 May 2019
North Atlantic Smaller Companies Investment Trust plc
Preliminary results for the year ended 31 January 2019
NASCIT is pleased to announce its results for the year ended 31
January 2019
The preliminary financial information, which comprises the
Statement of Comprehensive Income, the Statement of Changes in
Equity, the Balance Sheet and the Statement of Cash Flow together
with the related explanatory notes has been prepared on the basis
of the accounting policies as set out in the audited financial
statements for the year ended 31 January 2019 and International
Financial Reporting Standards and Interpretations issued by the
International Accounting Standards Board as adopted for use in the
EU ("IFRS")
The financial information set out in this announcement does not
constitute the Company's statutory accounts for the years ended 31
January 2019 or 2018 but is derived from those accounts. Statutory
accounts for 2018 have been delivered to the registrar of
companies, and those for 2019 will be delivered in due course. The
auditor has reported on those accounts; their reports were (i)
unqualified, (ii) did not include a reference to any matters to
which the auditor drew attention by way of emphasis without
qualifying their report and (iii) did not contain a statement under
section 498 (2) or (3) of the Companies Act 2006.
Highlights
31 January 2019 % change 31 January 2018 31 January 2017 31 January 2016 31 January 2015
----------------- ---------------- --------- ---------------- ---------------- ---------------- ----------------
revenue
Gross income
(GBP'000) 11,645 15.1% 10,115 6,105 3,175 1,840
Net Revenue
after tax
attributable to
shareholders
(GBP'000) 5,840 13.7% 5,138 1,295 (890) (2,182)
Basic return per
5p Ordinary
Share:*
- Revenue 40.59p 13.9% 35.62p 8.97p (6.13)p (14.55)p
- Capital 205.57p (54.8)% 455.29p 212.95p 490.70p 254.88p
assets
Total assets
less current
liabilities
(GBP'000) 531,425 6.0% 499,423 428,606 396,961 328,904
Net asset value
("NAV") per 5p
Ordinary
Share:**
Basic 3,710p 7.2% 3,462p 2,971p 2,749p 2,262p
Diluted 3,708p 7.2% 3,458p 2,968p 2,746p 2,259p
Basic adjusted 3,776p 7.0% 3,529p 3,036p 2,776p 2,300p
Diluted adjusted 3,774p 7.0% 3,525p 3,033p 2,773p 2,297p
Mid-market price
of the 5p
Ordinary Shares 2,910.0p 1.4% 2,870.0p 2,455.0p 2,280.0p 1,845.0p
discount to
diluted net
asset value 21.5% 17.0% 17.3% 17.0% 18.3%
discount to
diluted
adjusted net
asset value 22.9% 18.6% 19.1% 17.8% 19.7%
----------------- ---------------- --------- ---------------- ---------------- ---------------- ----------------
indices and
exchange rates
at 31 January
Standard &
Poor's 500
Composite Index 2,704.1 (4.2)% 2,823.8 2,278.9 1,940.2 1,995.0
Russell 2000
Index 1,499.4 (4.8)% 1,575.0 1,352.3 1,035.4 1,165.4
US
Dollar/Sterling
exchange rate 1.31505 (7.5)% 1.42205 1.2581 1.4185 1.5019
Standard &
Poor's 500
Composite Index
- Sterling
adjusted 2,062.8 3.7% 1,989.9 1,811.7 1,362.2 1,324.7
Russell 2000 -
Sterling
adjusted 1,143.8 3.1% 1,109.9 1,075.1 726.9 773.8
----------------- ---------------- --------- ---------------- ---------------- ---------------- ----------------
* Please refer to note 7 for details on how the basic return per
5p Ordinary Share is calculated.
** Includes current period revenue. Please refer to note 7 for
details on how the net asset value per 5p Ordinary Share is
calculated.
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 7.
chairman's statement
During the period under review, the fully-diluted net asset
value rose by 7.2% (pre-dividend) to 3,708p. This increase compares
with a rise in the sterling adjusted Standard & Poor's
Composite Index of 3.7%. However, the Company's performance was
particularly remarkable, because a significant part of the
portfolio is invested in UK small Cap shares which had a poor year
in general.
The revenue account showed a profit after tax of GBP5,840,000
(2018: GBP5,138,000). The Directors have therefore declared a final
dividend of 30p per share.
During the year, 100,000 shares were acquired for cancellation,
at a discount to net asset value, thereby building value for all
long-term shareholders. At the forthcoming AGM, shareholders will
be asked to support a whitewash proposal, allowing the company to
continue to repurchase shares without requiring our Chief Executive
and persons and companies presumed to be acting in concert with him
to make a mandatory offer under Rule 9 of The Takeover Code for the
Company. This proposal and the background surrounding it are
outlined in a separate circular being to sent to Shareholders.
Economic uncertainty persists with last year's monetary
tightening succeeded by a more accommodative Federal Reserve Bank
stance. It had been widely accepted that rates would continue to
normalise in 2019 and that quantitative easing would be unwound
over a five year period. Faced with a crisis of liquidity stock
markets fell sharply in the fourth quarter of 2018 which led to the
Federal Reserve's hasty volte-face. This in turn sparked off a
significant rally in equities but limits the scope for further
monetary stimulus in the event of a rapid decline in growth in the
coming year. While the US and China are working to improve their
fraught trade relationship with China probably committing to buying
more from the US, continental Europe will have difficulty in
adjusting to an aggressive US trade policy, the advanced
manufacturing success of Asia and a secular decline in the
traditional automobile industry. The UK with its emphasis on
services and its flexible entrepreneurialism should fare better,
supported by its more favourable reception in Washington as a
serious contributor to NATO.
As I stated last year, MIFID2 should create good opportunities
for the Company with the consequent contraction in smaller company
coverage and liquidity compelling many large institutions to change
their focus to the main market. Based on recent developments, it
now appears that as the dust settles the situations presented to us
will be far better than I anticipated. This will favour our
approach and create the opportunity for significant capital gain
over the next few years if these attractive investments can be
identified.
Finally, I would like to thank our Chief Executive, Christopher
Mills, for another excellent year despite an environment which was
undoubtedly challenging. I am hopeful that our unique and
distinctive investment style and process will enable the Company to
make good progress in the current year.
Peregrine Moncreiffe
Chairman
20 May 2019
investment manager's report
quoted portfolio
United Kingdom:
The market for smaller companies was weak throughout most of
2018. Profit warnings combined with limited liquidity created a
difficult environment with most relevant indices falling by more
than 10%. It is therefore pleasing to report that our portfolio
performed well.
The major standout success stories were Bioquell with the value
of our holding rising by GBP14 million, EKF/Renalytix which
contributed GBP11 million and the recently purchased Augean adding
almost GBP6 million. Oryx significantly outperformed its benchmarks
while the other major holdings (Ten Entertainment, MJ Gleeson and
Polar Capital) taken as a whole and adjusted for dividends made a
positive contribution to the net asset value. Two smaller holdings
have proved disappointing with both Sportech and Goals Soccer
falling after worse than expected results.
United States:
The equity portfolio made some good profits for the Company but
as the total value is less than GBP16 million, the overall impact
was limited. However, very substantial holdings were held in
short-dated US Treasury Bills which provided a considerable uplift
as Sterling weakened from $1.422 to $1.315 over the 12 month
period.
unquoted portfolio
United Kingdom:
Most of the unquoted portfolio is now concentrated in the two
private equity funds, Trident Private Equity III LP ("TPE3") and
Harwood Private Equity IV ("HPE IV"). Both funds performed well
during the year. TPE3 is currently in liquidation with only one
remaining investment which is expected to be sold in early 2020.
HPE IV is almost fully invested with further realisations expected
in the current year.
One major new investment made in the year, Pelsis/Hamsard, has
performed in line with expectations. It is anticipated that
remainder of the Company's property investments will be sold in the
current year.
United States:
Both Performance Chemicals and Jaguar performed well during the
past year and their prospects look good. Unfortunately the
arbitration decision on GAJV was unfavourable resulting in a
write-down on the investment.
A description of the unquoted investments can be found in the
Annual Report.
Liquidity:
Liquidity, that is, cash and short-term government securities,
at the end the period was GBP116 million up from GBP100 million
last year. This provides the Company with the resources for the
Trust to benefit from the favourable opportunities that are now
occurring to acquire good businesses at a discount to private
market value.
Whilst I have major reservations about stock market valuations
in general, I believe that we have a good portfolio of companies
that will create value for North Atlantic shareholders in the
coming years.
Christopher Mills
Chief Executive & Investment Manager
20 May 2019
sector analysis of investments at fair value
as at 31 January
equities,
convertible
securities & loan
stocks as a % of Canada Europe United States United Kingdom Total Total
total portfolio 31 January 31 January 31 January 31 January 31 January 31 January
valuation 2019 2019 2019 2019 2019 2018
% % % % % %
-------------------- -------------- -------------- -------------- --------------- -------------- ---------------
Telecommunications - - - 1.3 1.3 -
Financial Services - - - 23.5 23.5 26.4
Travel & Leisure - - - 10.8 10.8 14.5
Health Care - - - 11.5 11.5 13.5
Industrial Goods &
Services - 1.4 4.1 12.6 18.1 10.6
Real Estate - - - 2.1 2.1 9.7
Oil & Gas - - 2.9 - 2.9 2.7
Insurance - - 1.0 - 1.0 1.1
Banks - - 1.1 6.6 7.7 1.0
Technology - - 1.1 1.9 3.0 0.9
-------------------- -------------- -------------- -------------- --------------- -------------- ---------------
- 1.4 10.2 70.3 81.9 80.4
treasury bills - - 18.1 - 18.1 19.6
-------------------- -------------- -------------- -------------- --------------- -------------- ---------------
total at 31 January
2019 - 1.4 28.3 70.3 100.0
-------------------- -------------- -------------- -------------- --------------- -------------- ---------------
total at 31 January
2018 0.2 - 45.1 54.7 100.0
-------------------- -------------- -------------- -------------- --------------- -------------- ---------------
twenty largest investments
as at 31 January
At fair value
equities (including convertibles, loan stocks and related financing) GBP'000
---------------------------------------------------------------------- ------------------ --------------
Oryx International Growth Fund Limited* UK Listed 57,776
MJ Gleeson Group plc UK Listed 36,495
Ten Entertainment Group plc UK Listed 36,000
Polar Capital Holdings plc UK Quoted on AIM 32,970
EKF Diagnostics Holdings plc UK Quoted on AIM 31,262
Harwood Private Equity IV LP UK Unquoted 31,569
Sherwood Holdings Limited UK Unquoted 17,131
Performance Chemicals Company US Unquoted 13,815
Odyssean Investment Trust Plc UK Listed 13,500
Augean plc UK Quoted on AIM 12,250
ten largest investments 282,768
------------------------------------------------------------------------------------------ --------------
Harwood Leeds Property UK Unquoted 9,516
AssetCo plc UK Quoted on AIM 9,441
Benchmark Holdings plc UK Quoted on AIM 8,800
Coventbridge Group US Unquoted 7,604
Renalytix AI plc UK Quoted on AIM 7,374
BBA Aviation plc UK Listed 7,104
Pelsis Holding/Hamsard 3468 Limited UK Unquoted 6,981
BigBlu Broadband Plc UK Quoted on AIM 6,600
Trident Private Equity Fund III LP UK Unquoted 6,338
Sportech PLC UK Listed 6,205
twenty largest investments 358,731
Aggregate of other investments at fair value 51,072
------------------------------------------------------------------------------------------ --------------
409,803
US Treasury Bills 90,893
------------------------------------------------------------------------------------------ --------------
total 500,696
------------------------------------------------------------------------------------------ --------------
* incorporated in Guernsey.
All investments are valued at fair value.
strategic report
The Directors present the strategic report of the Company for
the year ended 31 January 2019.
principal activity
The Company carries on business as an investment trust and its
principal activity is portfolio investment.
objective
The Company's objective is to provide capital appreciation to
its Shareholders through investing in a portfolio of smaller
companies which are based primarily in countries bordering the
North Atlantic Ocean.
strategy
In order to achieve the Company's investment objective, the
Manager uses a stock specific approach in managing the Company's
portfolio, selecting investments that he believes will increase in
value over a period of time, whether that be due to issues in the
management of the businesses which he believes can be improved by
Shareholder engagement and involvement or simply due to the fact
that the stock is undervalued and he can see potential for
improvement in value over the long term. The Company may invest in
both quoted and unquoted companies. At present, the investments in
the portfolio are principally in companies which are located either
in the United Kingdom or the United States of America. Typically
the investment portfolio will comprise between 40 and 50
securities.
investment policy
While pursuing the Company's objective, the Manager must adhere
to the following:
1. the maximum investment limit is 15% of the Company's
investments in any one company at the time of the investment;
2. gearing is limited to a maximum of 30% of net assets;
3. the Company may invest on both sides of the Atlantic, with
the weighting varying from time to time;
4. the Company may invest in unquoted securities as and when
opportunities arise and again the weighting will vary from time to
time.
investment approach
The Company invests in a diversified range of companies, both
quoted and unquoted, on both sides of the Atlantic in accordance
with its objective and investment policy.
Christopher Mills, the Company's Chief Executive and Investment
Manager, is responsible for the construction of the portfolio and
details of the principal investments are set out in the Annual
Report. The top twenty largest investments by current valuation are
listed above.
When analysing a potential investment, the Manager will employ a
number of valuation techniques depending on their relevance to the
particular investment. A key consideration when deciding on a
potential investment would be the sustainability and growth of long
term cash flow. The Manager will consider the balance of quoted and
unquoted securities in the portfolio when deciding whether to
invest in an unquoted stock as he is aware that the level of risk
in unquoted securities may be considered higher.
In respect of the unquoted portfolio, regular contact is
maintained with the management of prospective and existing
investments and rigorous financial and business analysis of these
companies is undertaken. It is recognised that different types of
business perform better than others depending on economic cycles
and market conditions and this is taken into consideration when the
Manager selects investments and is therefore reflected within the
range of investments in the portfolio. The Company attempts to
minimise its risk by investing in a diversified spread of
investments whether that spread be geographical, industry type or
quoted or unquoted companies.
financial instruments
The financial instruments employed by the Company primarily
comprise equity and loan stock investments, although it does hold
cash and liquid instruments. Further details of the Company's risk
management objectives and policies relating to the use of financial
instruments can be found in note 14 to the financial
statements.
performance
At 31 January 2019, the diluted NAV per share was 3,708p (2018:
3,458p), an increase of 6.8% during the year, compared to an
increase of 3.7% during the year in the Standard & Poor's 500
Composite Index (Sterling adjusted).
Net assets attributable to equity holders at 31 January 2019
amounted to GBP531,425,000 compared with GBP499,423,000 at 31
January 2018.
The ongoing charges relating to the Company are 1.1% (2018:
1.0%), based on total expenses, excluding finance charges and
non-recurring items for the year and average monthly net
assets.
results and dividends
The total net return after taxation for the financial year ended
31 January 2019 amounted to GBP35,418,000 (2018: GBP70,817,000).
The Board proposes to pay a final dividend of 30p per share (2018:
nil).
key performance indicators
The Directors regard the following as the main key indicators
pertaining to the Company's performance:
(i) Net asset value per Ordinary Share: the following chart
illustrates the movement in the fully diluted net asset value per
Ordinary Share over the past five years:
(ii) Share price return: the following chart illustrates the
movement in the share price per Ordinary Share over the past five
years:
(iii) Performance against benchmark
The performance of the Company's share price is measured against
the Standard & Poor's 500 Composite Index (Sterling adjusted),
the Company's benchmark. A graph comparing performance can be found
in the Directors' Remuneration Report in the Annual Report.
principal risks and uncertainties
The key risks faced by the Company are set out below. The Board
regularly reviews these and agrees policies for managing these
risks.
-- Performance risk: the Board is responsible for deciding the
investment strategy in order to fulfil the Company's objectives and
for monitoring the performance of the Manager. An inappropriate
investment strategy may result in under performance against the
companies in the peer group or against the benchmark indices. The
Board manages this risk by ensuring that the investments are
appropriately diverse and by receiving reports from the Manager at
every board meeting explaining his investment decisions and the
composition and performance of the portfolio.
-- Market risk: this category of risk includes currency risk,
market price risk and interest rate risk. The fair value or future
cash flows of a financial investment held by the Company may
fluctuate because of changes in market prices. Also, the valuations
of the investments in the portfolio may be subject to fluctuation
due to exchange rates or general market prices. The Manager
monitors these fluctuations and the markets on a daily basis; the
performance of the investment portfolio against its benchmarks is
also closely monitored by the Manager. The afore-mentioned graph in
the Directors' Remuneration Report illustrates the Company's
performance against its benchmarks over the last nine years.
-- Impact of Brexit: the Board has considered whether Brexit
poses a discrete risk to the Company. The Board believes that
Brexit is unlikely to affect the Company's business model and is
also unlikely to have a perceptible impact on the level of discount
or premium at which the Company's shares trade. The Board will
continue to monitor developments as they occur.
-- Investments in unquoted stocks, by their nature, involve a
higher degree of risk than investments in the listed market. The
valuation of unquoted investments can include a significant element
of estimation based on professional assumptions that is not always
supported by prices from current market transactions. Recognised
valuation techniques are used and recent arms' length transactions
in the same or similar entities may be taken into account. Clearly
the valuation of such investments is therefore a key uncertainty
but the Board manages this risk by regularly reviewing the
valuation principles applied by the Manager to ensure that they
comply with the Company's accounting policies and with fair value
principles. Harwood Capital LLP, a firm which is ultimately owned
by Christopher Mills, the Company's Manager, and which provides
services such as dealings administration and compliance to the
Company, operates a Valuations and Pricing Committee which meets
regularly throughout the year to review and agree the valuations of
the investments in the portfolio for onward submission to the
Board. The Company's independent auditors also attend these
Committee meetings.
-- Discount volatility: the Company's shares historically trade
at a discount to its underlying net asset value. The Company has a
share buyback programme in place to try to narrow this discount as
far as possible by cancelling shares that it repurchases. The
Company repurchased 100,000 any Ordinary Shares for cancellation
during the year.
-- Regulatory risk: any breach of a number of regulations
applicable to the Company, the UKLA's Listing Rules and the
Companies Act could lead to a number of detrimental effects on the
Company as well as reputational damage. The Audit Committee
monitors compliance with these regulations in close alliance with
the Manager and Secretary.
-- Custodial and Banking risk: there is a risk that the
custodians and banks used by the Company to hold assets and cash
balances could fail and the Company's assets may not be returned.
Associated with this is the additional risk of fraud or theft by
employees of those third parties. The Board exercises monitoring
through the Manager and Harwood Capital LLP over the financial
position of its custodial banks.
-- Credit risk/Counterparty risk: the Company holds preference
shares in some investee companies and provides other forms of debt
or loan guarantees where deemed necessary. There is a risk of those
counterparties being unable to meet their obligations. The
financial position and performance of those investee companies are
continually monitored by the Manager and actions are taken to
protect the Company's investment if needed.
viability statement
In accordance with the UK Corporate Governance Code the Board
has considered the longer term prospects for the Company. The
Directors have reviewed the Company over the next three years to
May 2022, which is generally a reasonable investment horizon for
many investment trust shareholders. This assessment took into
account the Company's current position as well as its continuing
investment strategy. Additional factors under review included the
principal risks inherent in its management and portfolio structure,
contractual arrangements and cost base.
The Directors have noted the following elements as part of its
evaluation:
-- the Company invests in a combination of listed and unquoted
companies, the large majority of which have positive EBITDA and/or
net tangible asset values which support their valuations;
-- the Company holds around 20% of its portfolio in US Treasury
Bills which are readily realisable and intends to continue to hold
liquidity comfortably in excess of any contingent liabilities,
including any requirements to fund any future drawdowns resulting
from private equity or put option commitments; and
-- the Company's forecasts for income and expenses are
relatively stable while its overheads are largely variable and
positively correlated with the Company's net asset value and
relative performance, giving comfort that the Company could easily
cover costs in the event of a substantial decline in net asset
value.
The Directors have also assessed the Company's principal risks
and uncertainties and believe that appropriate measures are in
place to minimise the likelihood of their potential to impact the
viability of the Company. These measures include:
-- the Manager's reports on compliance with the investment objective;
-- the Manager's control of counterparty and custodial risk;
-- the Board's monitoring of gearing (if any), compliance with
specific investment guidelines and liquidity risk; and
-- monitoring the share price's discount to net asset value and
the stability of the shareholder base.
Based on the results of this analysis, the Directors have
concluded that there is a reasonable expectation that the Company
can continue in operation and meet its liabilities as they fall due
during the period to May 2022.
future prospects
The Directors are hopeful that some of the Company's investments
will see corporate activity over the coming year and that the year
ending 31 January 2020 will see a further rise in the Company's net
asset value.
social, community and human rights issues
As an investment trust with no employees the Company has no
direct social or community responsibilities or impact on the
environment. The Company, however, takes into account the impact of
environmental, social and governance factors when selecting and
managing its investments within the context of its obligation to
manage investments in the financial interests of its
shareholders.
modern slavery act
As an investment vehicle the Company does not provide goods or
services in the normal course of business. Accordingly, the
Directors consider that the Company is not required to make any
slavery or human trafficking statement under the Modern Slavery Act
2015.
greenhouse gas emissions
The Company has no physical assets, operations, premises or
employees of its own. Consequently it has no greenhouse gas
emissions to report. Hampton Investment Properties Limited, a
property investment and development company, in which the Company
has a 70.8% holding, has effectively liquidated its property
portfolio and now only owns a redevelopment site which produces no
greenhouse gas emissions. The Company's only other real estate
assets, held via the wholly owned subsidiary Harwood Leeds Limited
("Leeds"), owns 4 residential investment properties which it leases
out to third party tenants and the Company is not required to
report on this. It has not been practical to obtain this
information as Leeds is not required to collate such information
for its own reporting purposes, thus the information is not readily
available. However the properties naturally draw on domestic
electricity and gas in order to light and heat both the individual
rental units themselves as well as the relevant common parts. All
underlying units do of course benefit from both appropriate
Electrical Performance Certificates and all gas safety
verifications. However the Board has communicated its views on
environmental matters to the Leeds management team and requested
that they strive to minimise any impact on the environment.
AIFMD
The Company is authorised under the AIFMD as a Small Registered
UK Alternative Investment Fund Manager under regulation 10(1) of
the Alternative Investment Fund Managers Regulations 2013 (SI
2013/1773). Small registered UK AIFMs are not authorised persons as
a result of their registration as small registered UK AIFMs and are
not included on the Financial Services Register in relation to this
business. However, small registered UK AIFMs are not prevented from
carrying on regulated activities as a result of their registration
and therefore may be included on the Financial Services Register in
relation to other business. For AIFMD purpose the Company is
internally managed with Christopher Mills making the investment
decisions in his capacity as Chief Executive. As the Company has
passed the tipping point it is now seeking approval as a full-scope
UK AIFM of an internally managed AIF. The Company submitted the
original application in 2018 to vary the Company's FCA permission
and the FCA requested the Company to submit a full application for
authorisation which is in progress. It is envisaged that the
Company will be authorised as a full-scope AIFM by the end of
quarter three 2019.
By Order of the Board
Derringtons Limited
Company Secretary
20 May 2019
report of the directors
for the year ended 31 January
The Directors present their report to Shareholders and the
financial statements for the year ended 31 January 2019. Certain
information that is required to be disclosed in this report has
been provided in other sections of this Annual Report and
accordingly, these are incorporated into this report by
reference.
taxation status
In the opinion of the Directors, the Company has conducted its
affairs during the period under review, and subsequently, so as to
maintain its status as an investment trust for the purposes of
Chapter 4 of Part 24 of the Corporation Tax Act 2010. The Company
made a successful application under Regulation 5 of the Investment
Trust (Approved Company) (Tax) Regulations 2011 for investment
trust status to apply to all accounting periods starting on or
after 1 February 2013 subject to the Company continuing to meet the
eligibility conditions contained in Section 1158 of the Corporation
Tax Act 2010 and the ongoing requirements outlined in Chapter 3 of
Part 2 of the Regulations.
share capital
The Company's issued share capital consisted of 14,325,620
Ordinary Shares of 5p nominal value each on 31 January 2019. Since
the year end, no Ordinary Shares have been repurchased for
cancellation. All shares hold equal rights with no restrictions and
no shares carry special rights with regard to the control of the
Company. There are no special rights attached to the shares in the
event that the Company is wound up.
During the year, the Company purchased 100,000 Ordinary Shares
for cancellation.
share valuations
On 31 January 2019, the middle market quotation and the diluted
net asset value per 5p Ordinary Share were 2,910p and 3,708p
respectively. The comparable figures at 31 January 2018 were 2,870p
and 3,458p respectively. It should be noted that since the
conversion of the outstanding units of Convertible Unsecured Loan
Stock 2013, the only dilution on the net asset value is those share
options that have been issued to certain employees of the
Manager.
substantial shareholders
As at 31 January 2019, the following interests in the Ordinary
Shares of the Company which exceed 3% of the issued share capital
had been notified to the Company:
Number of Ordinary Shares % of issued share capital
------------------------------------- -------------------------- --------------------------
Christopher Mills 3,666,000 25.41
CG Asset Management Limited 1,116,363 7.79
Butterfield Trust (Bermuda) Limited 828,270 5.78
Rathbone Brothers Plc 789,405 5.51
Old Mutual Plc 754,038 5.26
------------------------------------- -------------------------- --------------------------
directors
The biographical details for Directors currently in office are
shown in the Annual Report.
The Company's Articles of Association require that Directors
should submit themselves for election at the first Annual General
Meeting following their appointment and thereafter for re-election
at least every three years. However, the Company is adopting the
requirements of the UK Corporate Governance Code in relation to the
annual re-election of directors. Therefore, in accordance with
provision B.7.1 of the UK Corporate Governance Code all of the
Directors will retire at the Annual General Meeting and being
eligible, offer themselves up for re-election.
The Chairman and other members of the Board recommend that the
Directors retiring be re-elected. The Chairman has confirmed that
all Directors retiring have been subject to performance evaluation
and as part of this evaluation the Chairman confirms that they
continue to demonstrate commitment to their role and in his view
continue to responsibly fulfil their functions. The rest of the
Board have evaluated the performance of the Chairman and have
confirmed that they are satisfied that his performance remains
effective and that he has demonstrated commitment to his role and
they therefore recommend his re-election at the forthcoming Annual
General Meeting. The Chairman has confirmed that he has no other
significant commitments that would impact on his role as Chairman
of the Company.
directors' interests
The interests of the Directors as notified to the Company,
including those of their connected persons, in the Ordinary Shares
of the Company as at 31 January 2019 and 31 January 2018 were as
follows:
31 January 2019 31 January 2018
5p Ordinary Shares 5p Ordinary Shares
------------------------------------------- ------------------- -------------------
Peregrine Moncreiffe 417,640 417,640
Christopher Mills 3,666,000 3,664,000
Christopher Mills (non-beneficial) 355,740 355,740
Kristian Siem (resigned 26 June 2018) N/A N/A
Lord Howard of Rising 5,000 5,000
G Walter Loewenbaum 15,000 15,000
Sir Charles Wake (appointed 27 June 2018) - -
------------------------------------------- ------------------- -------------------
There have been no changes to the above interests between 31
January 2019 and the date of this report.
Details of Directors' remuneration are described in the
Directors' Remuneration Report in the Annual Report.
Save as disclosed, no Director was party to or had any interest
in any contract or arrangement with the Company at any time during
the year.
significant agreements
The Company is required to disclose details of any agreement
that it considers to be essential to the business. Pursuant to the
Sub Advisory, Administration and Transmission Services Agreement
dated 15 June 2016, Harwood Capital LLP provides administration
services to the Company. This is considered by the Board to be a
significant agreement.
The Sub Advisory, Administration and Transmission Services
Agreement continues unless thereafter terminated by either party on
not less than twelve months' notice in writing or may be terminated
forthwith as a result of a material breach of the agreement or the
insolvency of either party. No compensation is payable on
termination of the Agreement. The Board reviews the activities of
the Manager. The Chief Executive carries out day-to-day investment
decisions for and on behalf of the Company. As part of this review,
the Board is satisfied that the continuing appointment of the
Manager, on the terms agreed, is in the best interests of
Shareholders. Christopher Mills has been Chief Executive of the
Company since 1984 and the Board consider it is in the best
interest of the Company for this arrangement to continue.
As part of this review, the Board has given consideration to the
experience, skills and commitment of the Chief Executive in
addition to the personnel, services and resources provided by
Harwood Capital LLP. The Company's performance over the last year
is described in the Chairman's Statement above.
related party transactions
Christopher Mills, the Chief Executive, is Chief Investment
Officer and a member of Harwood Capital LLP. Christopher Mills
makes day-to-day investment decisions for the Company in his
capacity as its Chief Executive and this position is distinct from
his position as Chief Investment Officer of Harwood Capital LLP.
Christopher Mills is a director of Growth Financial Services
Limited ("GFS"). GFS is a wholly-owned subsidiary of Harwood
Capital Management Limited, which is the holding company of the
Harwood group of companies and is, in turn, 100% owned by
Christopher Mills. Harwood Capital Management Limited is also a
Designated Member of Harwood Capital LLP.
Pursuant to the Secondment Services Agreement between the
Company, GFS and Christopher Mills and the Sub Advisory,
Administration and Transmission Services Agreement between the
Company and Harwood Capital LLP, Christopher Mills is responsible
for the day-to-day investment decisions. The Secondment Services
Agreement continues until terminated by the Company or GFS on not
less than twelve months' notice. Details of the related party
transactions and fees payable are disclosed in note 15 and in the
Directors' Remuneration Report in the Annual Report. The Investment
Management Fees are disclosed in note 3 of the Annual Report. Any
Performance Fee payable to GFS is disclosed in the Directors'
Remuneration Report of the Annual Report and notes 3 and 4 of the
financial statements.
With the exception of the matters referred to above, during the
year no Director was materially interested in any contract of
significance (as defined by the UK Listing Authority Listing Rules)
entered into by the Company.
institutional investors - use of voting rights
The Chief Executive, in the absence of explicit instruction from
the Board, is empowered to exercise discretion in the use of the
Company's voting rights in respect of investments and to then
report to the Board, where appropriate, regarding decisions taken.
The Board have considered whether it is appropriate to adopt a
voting policy and an investment policy with regard to social,
ethical and environmental issues and concluded that it is not
appropriate to change the existing arrangements.
donations
The Company does not make any political or charitable
donations.
post balance sheet events
There have been no significant events since the balance sheet
date other than those highlighted in this Annual Report.
creditors' payment policy
It is the Company's policy to settle investment transactions
according to the settlement periods operating for the relevant
markets. For other creditors, it is the Company's policy to pay
amounts due to them as and when they become due. All supplier
invoices received by 31 January 2019 had been paid (31 January 2018
- all supplier invoices paid).
auditors
Resolutions to reappoint KPMG LLP as the Company's auditors and
to authorise the Board to determine their remuneration will be
proposed at the forthcoming Annual General Meeting.
going concern
The Company's assets comprise readily realisable securities
which can be sold to meet funding commitments if necessary and it
also has sufficient cash reserves so the Directors have a
reasonable expectation that the Company has adequate resources to
continue in operation for the foreseeable future. They have,
therefore, adopted the going concern basis in preparing these
financial statements.
additional disclosures
The following further information is disclosed in accordance
with the Large and Medium-sized Companies and Groups (Accounts and
Reports) Regulations 2008:
-- the Company's capital structure and voting rights are
summarised earlier in this report and note 11;
-- details of the substantial shareholders in the Company are listed earlier in this report;
-- the rules concerning the appointment and replacement of
directors are contained in the Company's Articles of Association
and are discussed earlier in this report;
-- amendment of the Company's Articles of Association and powers
to issue on a pre-emptive basis or buy back the Company's shares
requires a special resolution to be passed by the Shareholders;
and
-- there are: no restrictions concerning the transfer of
securities in the Company; no special rights with regard to control
attached to securities; no agreements between holders of securities
regarding their transfer known to the Company; no agreements which
the Company is party to that might affect its control following a
takeover bid; no agreements between the Company and its Directors
concerning compensation for loss of office; and no qualifying third
party indemnities in place.
By Order of the Board
Derringtons Limited
Company Secretary
Registered Office:
6 Stratton Street
Mayfair
London
W1J 8LD
Registered No: 1091347
20 May 2019
statement of directors' responsibilities in respect of the
annual report and the financial statements
for the year ended 31 January
The Directors are responsible for preparing the Annual Report
and the financial statements in accordance with applicable law and
regulations.
Company law requires the Directors to prepare financial
statements for each financial year. Under that law they are
required to prepare the financial statements in accordance with
International Financial Reporting Standards as adopted by the
European Union (IFRSs as adopted by the EU) and applicable law.
Under company law the Directors must not approve the financial
statements unless they are satisfied that they give a true and fair
view of the state of affairs of the Company and of their profit or
loss for that period. In preparing these financial statements, the
Directors are required to:
-- select suitable accounting policies and then apply them consistently;
-- make judgements and estimates that are reasonable, relevant and reliable;
-- state whether they have been prepared in accordance with IFRSs as adopted by the EU;
-- assess the Company's ability to continue as a going concern,
disclosing, as applicable, matters related to going concern;
and
-- use the going concern basis of accounting unless they either
intend to liquidate the Company or to cease operations, or have no
realistic alternative but to do so.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Company's
transactions and disclose with reasonable accuracy at any time the
financial position of the Company and enable them to ensure that
its financial statements comply with the Companies Act 2006. They
are responsible for such internal control as they determine is
necessary to enable the preparation of financial statements that
are free from material misstatement, whether due to fraud or error,
and have general responsibility for taking such steps as are
reasonably open to them to safeguard the assets of the Company and
to prevent and detect fraud and other irregularities.
Under applicable law and regulations, the Directors are also
responsible for preparing a Strategic Report, Directors' Report,
Directors' Remuneration Report and Corporate Governance Statement
that complies with that law and those regulations.
The Directors are responsible for the maintenance and integrity
of the corporate and financial information included on the
company's website. Legislation in the UK governing the preparation
and dissemination of financial statements may differ from
legislation in other jurisdictions.
responsibility statement of the directors in respect of the
annual financial report
We confirm that to the best of our knowledge:
-- the financial statements, prepared in accordance with the
applicable set of accounting standards, give a true and fair view
of the assets, liabilities, financial position and profit or loss
of the Company taken as a whole; and
-- the Strategic Report and the Report of the Directors includes
a fair review of the development and performance of the business
and the position of the issuer, together with a description of the
principal risks and uncertainties that they face.
We consider the Annual Report and financial statements, taken as
a whole, is fair, balanced and understandable and provides the
information necessary for shareholders to assess the Company's
position and performance, business model and strategy.
For and on behalf of the Board
Peregrine Moncreiffe
Chairman
20 May 2019
statement of comprehensive income
for the year ended 31 January
2019 2018
Notes Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
---------------------------------------- ------ -------- -------- -------- -------- -------- --------
Income 2 11,645 - 11,645 10,115 - 10,115
Net gains on investments at fair value 8 - 31,095 31,095 - 69,197 69,197
Currency exchange gains/(losses) 8 - 271 271 - (769) (769)
---------------------------------------- ------ -------- -------- -------- -------- -------- --------
total income 11,645 31,366 43,011 10,115 68,428 78,543
Expenses
Investment management fee 3 (5,091) (1,788) (6,879) (4,380) (2,749) (7,129)
Other expenses 4 (714) - (714) (586) - (586)
---------------------------------------- ------ -------- -------- -------- -------- -------- --------
return before taxation 5,840 29,578 35,418 5,149 65,679 70,828
Taxation 6 - - - (11) - (11)
---------------------------------------- ------ -------- -------- -------- -------- -------- --------
return for the year 5,840 29,578 35,418 5,138 65,679 70,817
---------------------------------------- ------ -------- -------- -------- -------- -------- --------
basic earnings per ordinary share 7 40.59 205.57 246.16 35.62 455.29 490.91
diluted earnings per ordinary share 7 40.53 205.27 245.80 35.61 455.19 490.80
---------------------------------------- ------ -------- -------- -------- -------- -------- --------
The total column of the statement is the Statement of
Comprehensive Income of the Company, prepared in accordance with
IFRS, as adopted by the European Union. The supplementary revenue
and capital columns are presented in accordance with the Statement
of Recommended Practice issued by the Association of Investment
Companies ("AIC SORP").
All items in the above Statement derive from continuing
operations. No operations were acquired or discontinued in the
year.
There is no other comprehensive income, and therefore the return
for the year is also the comprehensive income.
The notes form part of these financial statements.
statement of changes in equity
for the year ended 31 January
Share Share Capital
Share options premium Capital redemption Revenue
Capital reserve account reserve reserve reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------------- --------- --------- --------- --------- ------------ --------- --------
2019
31 January 2018 721 55 1,301 498,123 149 (926) 499,423
Total comprehensive income
for the year - - - 29,578 - 5,840 35,418
Shares purchased for cancellation (5) - - (2,920) 5 - (2,920)
Share options discharge - (31) - (465) - - (496)
31 January 2019 716 24 1,301 524,316 154 4,914 531,425
----------------------------------- --------- --------- --------- --------- ------------ --------- --------
Share Share Capital
options premium Capital redemption Revenue
Share Capital reserve account reserve reserve reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------- -------------- ------------- ------------- -------------- ------------- -------------- --------
2018
31 January
2017 721 55 1,301 432,444 149 (6,064) 428,606
Total
comprehensive
income for
the year - - - 65,679 - 5,138 70,817
31 January
2018 721 55 1,301 498,123 149 (926) 499,423
--------------- -------------- ------------- ------------- -------------- ------------- -------------- --------
The notes form part of these financial statements.
balance sheet
as at 31 January
31 January 31 January
2019 2018
Notes GBP'000 GBP'000
------------------------------------------------------ ------ ----------- -----------
non current assets
Investments at fair value through profit or loss 8 500,696 488,912
------------------------------------------------------ ------ ----------- -----------
500,696 488,912
current assets
Trade and other receivables 9 19,623 3,943
Cash and cash equivalents 30,669 10,653
------------------------------------------------------ ------ ----------- -----------
50,292 14,596
------------------------------------------------------ ------ ----------- -----------
total assets 550,988 503,508
------------------------------------------------------ ------ ----------- -----------
current liabilities
Trade and other payables 10 (19,563) (4,085)
------------------------------------------------------ ------ ----------- -----------
total liabilities (19,563) (4,085)
------------------------------------------------------ ------ ----------- -----------
total assets less current liabilities 531,425 499,423
------------------------------------------------------ ------ ----------- -----------
net assets 531,425 499,423
------------------------------------------------------ ------ ----------- -----------
represented by:
Share capital 11 716 721
Share options reserve 24 55
Share premium account 1,301 1,301
Capital reserve 524,316 498,123
Capital redemption reserve 154 149
Revenue reserve 4,914 (926)
------------------------------------------------------ ------ ----------- -----------
total equity attributable to equity holders of the company 531,425 499,423
-------------------------------------------------------------- ----------- -----------
net asset value per ordinary share:
Basic 7 3,710p 3,462p
Diluted 7 3,708p 3,458p
These financial statements were approved and authorised for
issue by the Board of Directors on 20 May 2019 and signed on its
behalf by:
The notes form part of these financial statements.
Peregrine Moncreiffe, Chairman
Company Registered Number: 1091347
cash flow statement
for the year ended 31 January
2019 2018
Notes GBP'000 GBP'000
--------------------------------------------------------- ------ ---------- ----------
cash flows from operating activities
Investment income received 9,002 7,023
Deposit interest received 15 5
Other income - 192
Investment Manager's fees paid (7,686) (4,398)
Share based payment - discharge of options (496)
Other cash payments (826) (653)
--------------------------------------------------------- ------ ---------- ----------
cash generated from operations 12 9 2,169
Taxation paid - (11)
--------------------------------------------------------- ------ ---------- ----------
net cash inflow from operating activities 9 2,158
--------------------------------------------------------- ------ ---------- ----------
cash flows from investing activities
Purchases of investments (358,127) (431,754)
Sales of investments 380,966 428,896
--------------------------------------------------------- ------ ---------- ----------
net cash inflow/(outflow) from investing activities 22,839 (2,858)
--------------------------------------------------------- ------ ---------- ----------
cash flows from financing activities
Repurchase of Ordinary Shares for cancellation (2,920) -
--------------------------------------------------------- ------ ---------- ----------
net cash outflow from financing activities (2,920) -
--------------------------------------------------------- ------ ---------- ----------
increase/(decrease) in cash and cash equivalents for the year 19,928 (700)
----------------------------------------------------------------- ---------- ----------
Revaluation of foreign currency balances 88 (476)
cash and cash equivalents at the end of the year 13 30,669 10,653
--------------------------------------------------------- ------ ---------- ----------
The notes form part of these financial statements.
notes to the financial statements
1 accounting policies
NASCIT is a listed public company incorporated and registered in
England and Wales. The registered office of the Company is 6
Stratton Street, Mayfair, London W1J 8LD. 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 and
its investment approach is detailed in the Strategic Report.
a) basis of preparation
The financial statements of the Company have been prepared in
accordance with IFRS as adopted by the European Union which
comprise standards and interpretations approved by the
International Accounting Standards Board ('IASB'), and as applied
in accordance with the provisions of the Companies Act 2006. The
annual 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.
In order to better reflect the activities of an investment trust
company and in accordance with guidance issued by the AIC,
supplementary information which analyses the Income Statement
between items of a revenue and capital nature has been prepared
alongside the Income Statement.
The functional currency of the Company is Pounds Sterling
because this is the currency of the primary economic environment in
which the Company operates. The financial statements are also
presented in Pounds Sterling rounded to the nearest thousand,
except where otherwise indicated.
b) going concern
The financial statements have been prepared on a going concern
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 at least 12 months from the date these
financial statements were approved. Furthermore, the Directors are
not aware of any material uncertainties that may cast doubt upon
the Company's ability to continue as a going concern, having taken
into account the liquidity of the Company's investment portfolio
and the Company's financial position in respect of its cash flows,
debt and investment commitments. Therefore, the financial
statements have been prepared on a going concern basis.
c) segmental reporting
The Directors of the opinion that the Company is engaged in a
single segment of the business, being investment business. The
Company invests in small companies principally based in countries
bordering the North Atlantic Ocean.
d) accounting developments
In the current year, the Company has applied a number of
amendments to IFRS, issued by the IASB mandatorily effective for an
accounting period that begins on 1 January 2018. These include
annual improvements to IFRS, changes in standards, legislative and
regulatory amendments, changes in disclosure and presentation
requirements. The Company has also applied, with associated
amendments, for the first time the following standards:
-- IFRS 2 Share based payments (amendments);
-- IFRS 9 Financial Instruments; and
-- IFRS 15 Revenue from Contracts with Customers.
The assessment of the impact of the adoption of these standards
is set out below:
IFRS 2 Share based Payments has been amended to clarify the
classification and measurement of share based payments. Details of
the accounting policy are set out in note 5.
IFRS 9 Financial Instruments addresses the classification,
measurement and derecognition of financial assets and financial
liabilities, introduces new rules for hedge accounting and a new
impairment model for financial assets, and replaces the multiple
classification and measurement models in IAS 39. The financial
instruments are managed and have their performance evaluated on a
fair value basis, in accordance with the risk management and
investment strategies of the Company consistent with prior
periods.
The other receivables and prepayment are accounted for at
amortised cost meeting the criteria for classification in IFRS 9,
hence there has been no change in the accounting for these assets.
The new impairment model requires the recognition of impairment
provisions based on expected credit losses rather than incurred
credit losses as in the case of IAS39 applicable to all financial
assets.
IFRS 15 specifies how and when revenue is recognised and
enhances disclosures. Given the nature of the Company's revenue
streams from financial instruments, the provisions of this standard
will not have a material impact. There are no changes in the
methodology of accounting for investment income and other income is
recognised when the amounts fall due, both consistent with prior
periods. The application of IFRS 9 the changes in fair value of
financial assets through profit or loss do not fall within the
scope of IFRS15.
The adoption of these has not had any material impact on these
financial statements.
e) critical accounting judgements and key sources of estimation
uncertainty
The preparation of financial statements in conformity with IFRS
requires management to make judgements, estimates and assumptions
that affect the application of policies and the reported amounts in
the Balance Sheet, the Income Statement and the disclosure of
contingent assets and liabilities at the date of the financial
statements. The estimates and associated assumptions are based on
historical experience and various other factors that are believed
to be reasonable under the circumstances, the results of which form
the basis of making judgements about carrying values of assets and
liabilities that are not readily apparent from other sources.
Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an
ongoing basis. Revisions to accounting estimates are recognised in
the period in which the estimate is revised if the revision affects
only that period, or in the period of the revision and future
period if the revision affects both current and future periods.
In order to value the unquoted investments, there are a number
of valuation techniques that can be used. Judgement is used to
determine the best methodology to obtain the most accurate
valuation.
The Board of Directors has assessed the Company as meeting the
definition of an investment entity within IFRS 10 Consolidated
Financial Statements requirements. The Company is required to
measure the subsidiaries at fair value through profit or loss
rather than consolidate the entities. The details are set out in
note 8.
Further to the above there were no accounting estimates or
significant judgements in the current period that have had a
material impact upon the financial statements.
f) investments
The Company's business is investing in financial assets with a
view to profiting from their total return in the form of income and
capital growth. The Company classifies its investments based on
their contractual cash flow characteristics and of the Company's
business model for managing the assets. The business model, which
is the determining feature, is such that the portfolio of
investments is managed, performance and risk is evaluated on a fair
value basis. Consequently, all investments are designated as at
fair value through profit or loss.
All investments are designated upon initial recognition as held
at fair value through profit or loss, and are measured at
subsequent reporting dates at fair value, which is either the bid
price or the closing price for Stock Exchange Electronic Trading
Service - quotes and crosses ('SETSqx'). The Company derecognises a
financial asset only when the contractual rights to the cash flows
from the asset expire, or when it transfers the financial asset and
substantially all the risks and rewards of ownership of the asset
to another entity. On derecognition of a financial asset, the
difference between the asset's carrying amount and the sum of
consideration received and receivable and the cumulative gain or
loss that had been accumulated is recognised in profit or loss.
Fair values for unquoted investments, or investments for which
the market is inactive, are established by using (the "IPEV")
various valuation techniques in accordance with the International
Private Equity and Venture Capital Valuation guidelines. These may
include recent arm's length market transactions, the current fair
value of another instrument which is substantially the same,
discounted cash flow analysis and option pricing models. Where
there is a valuation technique commonly used by market participants
to price the instrument and that technique has been demonstrated to
provide reliable estimates of prices obtained in actual market
transactions, that technique is utilised. Where no reliable fair
value can be estimated for such instruments, they are carried at
cost subject to any provision for impairment.
Gains and losses arising from changes in fair value are included
in the total return as a capital item. Also included within this
heading are transaction costs in relation to the purchase or sale
of investments. When a sale or purchase is made under a contract,
the terms of which require delivery within the timeframe of the
relevant market, the investments concerned are recognised or
derecognised on the trade date.
All investments for which a fair value is measured or disclosed
in the financial statements are categorised within the fair value
hierarchy levels set out in note 14.
g) foreign currency translation
Transactions in currencies other than Pounds Sterling are
recorded at the rates of exchange prevailing on the date of the
transaction. Items that are denominated in foreign currencies are
retranslated at the rates prevailing on the Balance Sheet date. Any
gain or loss arising from a change in exchange rate subsequent to
the date of the transaction is included as an exchange gain or loss
in the capital reserve or the revenue account depending on whether
the gain or loss in the capital reserve or the revenue account
depending on whether the gain or loss is capital or revenue in
nature.
h) cash and cash equivalents
Cash comprises cash in hand, overdrafts and demand deposits.
Cash equivalents are short-term, highly liquid investments that are
readily convertible to known amounts of cash and which are subject
to insignificant risk of changes in value.
For the purpose of the Statement of Cash Flows, cash and cash
equivalents consist of cash and cash equivalents as defined above,
net of outstanding bank overdrafts when applicable.
i) other receivables and payables
Trade receivables and trade payables are measured at amortised
cost and balances revalued for exchange rate movement.
j) income
Dividends receivable on quoted equity shares are taken to
revenue on an ex-dividend basis. Dividends receivable on equity
shares where no ex-dividend date is quoted are brought into account
when the Company's right to receive payment is established. Fixed
returns on non-equity shares are recognised on a time-apportioned
basis. Dividends from overseas companies are shown gross of any
withholding taxes which are disclosed separately in the Statement
of Comprehensive Income.
Special dividends are taken to the revenue or capital account
depending on their nature. In deciding whether a dividend should be
regarded as capital or revenue receipt, the Board reviews all
relevant information as to the sources of the dividend on a
case-by-case basis.
When the Company has elected to receive scrip dividends in the
form of additional shares rather than in cash, the amount of the
cash dividend foregone is recognised as income. Any excess in the
value of the cash dividend is recognised in the capital column.
All other income is accounted on a time-apportioned accruals
basis and is recognised in the Statement of Comprehensive
Income.
k) expenses and finance costs
All expenses are accounted on an accruals basis and are
allocated to wholly to revenue with the exception of the
Performance Fees which are allocated wholly to capital, as the fee
payable by reference to the capital performance of the Company.
Expenses incurred in shares purchased for cancellation are
charged to the capital reserve through the Statement of Changes in
Equity.
l) share based payments
The value of share options awarded under the 2011 Executive
Share Option Scheme to the Chief Executive and employees of Harwood
Capital LLP. The accounting charge is based on the fair value of
each grant, measured at the grant date and is spread over the
vesting period. The deemed expense over the vesting period is
transferred to the Share Options Reserve.
Where the share options are discharged this is released to the
Share Options Reserve.
In accordance with the IFRS 2: Share Based Payments where there
is a change in value this is recognised immediately.
m) taxation
The charge for taxation is based on the net revenue for the year
and takes into account taxation deferred or accelerated because of
temporary differences between the treatment of certain items for
accounting and taxation purposes.
Deferred tax is provided using the liability method on temporary
differences between the tax bases of assets and liabilities and
their carrying amount for financial reporting purposes at the
reporting date. Deferred tax assets are only recognised if it is
considered more likely than not that there will be suitable profits
from which the future reversal of timing differences can be
deducted. In line with recommendations of the SORP, the allocation
method used to calculate the tax relief expenses charged to capital
is the 'marginal' basis. Under this basis, if taxable income is
capable of being offset entirely by expenses charged through the
revenue account, then no tax relief is transferred to the capital
account.
n) dividends payable to shareholders
Dividends to shareholders are recognised as a liability in the
period in which they are paid or approved in general meetings and
are taken to the Statement of Changes in Equity. Dividends declared
and approved by the Company after the Balance Sheet date have not
been recognised as a liability of the Company at the Balance Sheet
date.
o) share capital and reserves
Share Capital: Represents the nominal value of equity
shares.
Share Options Reserve: The expense of share based payments. The
fair value of Share Options is measured at grant date and spread
over the vesting period. The deemed expense is transferred to the
Share Options Reserve.
Share Premium Account: The account represents the accumulated
premium paid for shares issued in previous periods above their
nominal value less issue expenses.
Capital Reserve: The following items are taken to this
reserve:
-- realised and unrealised capital and exchange gains and losses
on the disposal and revaluation of investments and of foreign
currency items;
-- performance fee costs; and
-- Ordinary Shares repurchased for cancellation.
Capital Redemption reserve: The amount by which the share
capital has been reduced, equivalent to the nominal value of the
Ordinary Shares repurchased for cancellation.
Revenue reserves: Represents the surplus of accumulated revenue
profits being the excess of income derived from holding investments
less the costs associated with running the Company. This reserve
may be distributed by way of dividends.
2 income
2019 2018
GBP'000 GBP'000
----------------------------- -------- --------
income from investments
Dividend income 5,646 4,426
Unfranked investment income
- interest 2,476 3,077
- interest reinvested 3,500 2,450
----------------------------- -------- --------
11,622 9,953
----------------------------- -------- --------
other income
Interest receivable 15 5
Net return from Subsidiary 7 82
Realised gains on income 1 -
Sundry income received - 75
----------------------------- -------- --------
23 162
----------------------------- -------- --------
Total income 11,645 10,115
----------------------------- -------- --------
total income comprises
Dividends 5,646 4,426
Interest 5,991 5,532
Other income 8 157
----------------------------- -------- --------
11,645 10,115
----------------------------- -------- --------
income from investments
Listed UK 5,646 4,350
Other listed - 76
Other unquoted 5,976 5,527
----------------------------- -------- --------
11,622 9,953
----------------------------- -------- --------
3 investment management fee
(i) Pursuant to the Secondment Services Agreement, described in
the Report of the Directors above and the Directors' Remuneration
Report of the Annual Report, GFS provides the services of
Christopher Mills as Chief Executive of the Company, who is
responsible for day-to-day investment decisions. Christopher Mills
is a director of GFS. GFS is entitled to receive part of the
investment management and related fees payable to GFS and Harwood
Capital LLP as may be agreed between them from time to time.
(ii) Pursuant to the terms of the Sub Advisory, Administration
and Transmission Services Agreement, described above in the Report
of the Directors, Harwood Capital LLP is entitled to receive a fee
(the Annual Fee) in respect of each financial period equal to the
difference between (a) 1% of Shareholders' Funds (as defined) on 31
January each year and (b) the amount payable to GFS referred to in
note 3(i) above. This fee is payable quarterly in advance.
As set out in note 15, no formal arrangements exist to avoid
double charging on investments managed or advised by the Chief
Executive or Harwood Capital LLP.
(iii) The Performance Fee, calculated annually to 31 January, is
only payable if the investment portfolio, including Oryx at the
adjusted price, outperforms the Sterling adjusted Standard &
Poors' 500 Composite Index. It is calculated as 10% of the
outperformance and paid as a percentage of Shareholders' Funds. It
is limited to a maximum payment of 0.5% of Shareholders' Funds. The
Performance Fee arrangements payable to GFS have been in place
since 1984 when they were approved by Shareholders.
The amounts payable in the year in respect of investment
management are as follows:
2019 2018
Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- -------- -------- -------- -------- -------- --------
Annual fee 5,091 - 5,091 4,380 - 4,380
Performance Fee - 1,743 1,743 - 2,560 2,560
Irrecoverable VAT thereon - 45 45 - 189 189
--------------------------- -------- -------- -------- -------- -------- --------
5,091 1,788 6,879 4,380 2,749 7,129
--------------------------- -------- -------- -------- -------- -------- --------
At 31 January 2019, GBP255,000 was payable to Harwood Capital
LLP in respect of outstanding management fees (2018: GBP219,000).
At 31 January 2019, there was GBP1,743,000 payable to GFS in
respect of outstanding performance fees (2018: GBP2,560,000) net of
VAT.
4 other expenses
2019 2018
GBP'000 GBP'000
------------------------------------ -------- --------
Auditor's remuneration (see below) 57 53
Directors' fees (see below) 130 130
Administration fee (see note 3) 263 243
Other expenses 264 160
------------------------------------ -------- --------
714 586
------------------------------------ -------- --------
2019 2018
GBP'000 GBP'000
----------------------------------- -------- --------
auditors' remuneration
Fees payable to Auditor for audit 57 53
----------------------------------- -------- --------
57 53
----------------------------------- -------- --------
2019 2018
GBP'000 GBP'000
----------------------------------------- -------- --------
directors' remuneration
a) Directors Fees
Peregrine Moncreiffe (Chairman) 30 30
Kristian Siem 10 25
Enrique Foster Gittes - 21
Lord Howard of Rising 25 25
Christopher Mills 25 25
G Walter Loewenbaum 25 4
Christopher Wake 15 -
----------------------------------------- -------- --------
130 130
----------------------------------------- -------- --------
b) Other fees
Performance fee (net of VAT)* 1,743 2,560
Investment management and related fees* 2,037 1,752
----------------------------------------- -------- --------
3,780 4,442
----------------------------------------- -------- --------
* Payable to GFS.
5 share based remuneration
A list of the Options in issue are shown below;
Grant of
No. of options Year of Discharged during options during No. of Options
at 1 February 2018 grant the year the year Price at 31 January 2019
10,000 2011 nil nil 1,467.71 10,000
20,000 2012 20,000 nil 1,396.24 nil
Further details of Options are disclosed in note 11.
On 14 July 2011, Christopher Mills was granted 420,000 share
options under the NASCIT 2011 Executive Share Option Scheme at an
exercise price of 1,467.71p per share. A further 10,000 options
were granted to an eligible employee of Harwood Capital LLP.
Christopher Mills discharged his share of these options on 23
October 2014. The remaining 10,000 options are exercisable
(providing the necessary performance requirements are met) between
14 July 2014 and 14 July 2021.
On 9 July 2012, a further 30,000 options were granted to other
eligible employees of Harwood Capital LLP at an exercise price of
1,396.24p. 10,000 options were discharged on 31 May 2015 with the
remaining 20,000 options being discharged on 23 October 2018.
The fair value of the share options is estimated at the
respective grant date using a binominal lattice. The Board
commissioned an independent third party to calculate the fair value
of the share options under IFRS 2. The assumptions used in
calculating the fair value are included in the table below:
2011 Options 2012 Options
Award date 14.Jul.11 09.Jul.12
Exercise price 1,467.71p 1,396.24p
Assumptions: per annum per annum
Future share price volatility 25.0% 20.0%
Future dividend yield 0.0% 0.0%
Future risk-free interest rate 1.2% 0.3%
Minimum gain threshold 33.0% 33.0%
Proportion of options exercised given minimum gain achieved 50.0% 50.0%
Share price^ 1,097.00p 1,045.00p
^ Share price is the closing mid-market price on the day before
the date of grant.
Based on the above assumptions [(prior to any options
discharged)]:
- the fair value of the 2011 options has been calculated as
22.1% of the face value of the awards (based on the share price of
1,097.00p) giving a total fair value of GBP1,042,000.
- the fair value of the 2012 options has been calculated as
15.0% of the face value of the awards (based on the share price of
1,045.00p) giving a total fair value of GBP47,000.
The accounting charge is based on the fair value of each grant,
at the grant date and is spread over the vesting period, being 3
years from the date of grant assuming all necessary performance
criteria are met. The deemed expense is transferred to the Share
options reserve. As at 31 January 2019 and 2018 there was no
accounting charge as the vesting period has expired.
At the date of this report there were a total of 10,000 options
in issue with an estimated fair value at the date of grant of
GBP24,000.
6 taxation on ordinary activities
2019 2018
Total Total
GBP'000 GBP'000
Withholding tax - 11
----------------- ---------- ---------
- 11
---------------------------- ---------
The current taxation charge for the year is different from the
standard rate of corporation tax in the UK of 19%. The differences
are explained below.
2019 2018
Total Total
GBP'000 GBP'000
Total return before taxation 35,418 70,828
------------------------------------------------------------------------------ --------- ---------
Theoretical tax at UK Corporation tax rate of 19% (2018: 19.17%) 6,729 13,578
Effects of:
Non taxable capital return (5,959) (13,118)
UK and overseas dividends which are not taxable (1,073) (848)
Subsidiary return which is not taxable (1) (16)
Withholding tax - 11
Decrease in tax losses, disallowable expenses and excess management expenses 340 404
------------------------------------------------------------------------------ --------- ---------
Actual current tax charge - 11
------------------------------------------------------------------------------ --------- ---------
Factors that may affect future tax charges:
As at 31 January 2019, the Company has tax losses of
GBP60,540,000 (2018: GBP56,079,000) that are available to offset
future taxable revenue, comprising excess management expenses of
GBP51,545,000, a non-trade loan relationship deficit of
GBP8,995,000 and a trade loss of GBPnil (2018: excess management
expenses of GBP47,308,000, a non-trade loan relationship deficit of
GBP8,771,000 and a trade loss of GBPnil). A deferred tax asset has
not been recognised in respect of those losses as the Group is not
expected to generate taxable income in the future in excess of the
deductible expenses of future periods and, accordingly, it is
unlikely that the Group will be able to reduce future tax
liabilities through the use of those losses.
The Company is exempt from corporation tax on capital gains
provided it maintains its status as an investment trust under
Chapter 4 of Part 24 of the Corporation Tax Act 2010. Due to the
Company's intention to continue to meet the conditions required to
maintain its investment trust status, it has not provided for
deferred tax on any capital gains or losses arising on the
revaluation or disposal of investments.
7 return per ordinary share and net asset value per ordinary
share
a) return per ordinary share:
Revenue Capital Total
Net Net Net
return Ordinary Per Share return Ordinary Per Share return Ordinary Per Share
GBP'000 Shares pence GBP'000 Shares pence GBP'000 Shares pence
---------- --------- ----------- ---------- --------- ----------- ---------- --------- ----------- ----------
2019
Basic
return
per
Share 5,840 14,388,359 40.59 29,578 14,388,359 205.57 35,418 14,388,359 246.16
Share
options* - 20,895 - 20,895 - 20,895
---------- --------- ----------- --------- ----------- --------- -----------
Diluted
return
per
Share 5,840 14,409,254 40.53 29,578 14,409,254 205.27 35,418 14,409,254 245.8
---------- --------- ----------- --------- ----------- --------- -----------
Revenue Capital Total
----------
Net Net Net
return Ordinary Per Share return Ordinary Per Share return Ordinary Per Share
GBP'000 Shares pence GBP'000 Shares pence GBP'000 Shares pence
---------- --------- ----------- ---------- --------- ----------- ---------- --------- ----------- ----------
2018
Basic
return
per
Share 5,138 14,425,620 35.62 65,679 14,425,620 455.29 70,817 14,425,620 490.91
Share
options* - 3,324 - 3,324 - 3,324
---------- --------- ----------- --------- ----------- --------- -----------
Diluted
return
per
Share 5,138 14,428,944 35.61 65,679 14,428,944 455.19 70,817 14,428,944 490.80
---------- --------- ----------- --------- ----------- --------- -----------
Basic return per Ordinary Share has been calculated using the
weighted average number of Ordinary Shares in issue during the
year.
* Excess of total number of potential shares on Option
Conversion over the number that could be issued at the average
market price, as calculated in accordance with IAS 33: Earnings per
share.
b) net asset value per ordinary share:
The net asset value per Ordinary Share calculated in accordance
with the Articles of Association is as follows:
Net assets Number of Net asset
2019 GBP'000 Ordinary Shares value per Share
Ordinary Shares - Basic 531,425 14,325,620 3,710p
- Diluted 531,572 14,335,620 3,708p
Ordinary Shares* - Basic 540,920 14,325,620 3,776p
- Diluted 541,067 14,335,620 3,774p
Net assets Number of Net asset
2018 GBP'000 Ordinary Shares value per Share
Ordinary Shares - Basic 499,423 14,425,620 3,462p
- Diluted 499,849 14,455,620 3,458p
Ordinary Shares* - Basic 509,128 14,425,620 3,529p
- Diluted 509,554 14,455,620 3,525p
* Adjusted for Oryx using equity accounting.
The diluted net asset value per Ordinary Share is calculated on
the assumption that the outstanding 10,000 (2018: 30,000) Share
Options were exercised at the prevailing exercise prices, giving a
total of 14,335,620 issued Ordinary Shares (2018: 14,455,620).
The Company has also reported an adjusted net asset value per
share, 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
was 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 year end, are as follows:
2019 2018
GBP'000 GBP'000
------------------------------------------------- -------- --------
Oryx at Fair value (traded price) using IFRS 10 57,776 55,663
Oryx value using Equity Accounting 67,270 65,368
Increase in net assets using Equity Accounting 9,494 9,705
8 investments at fair value through profit or loss
a) investments at fair value through profit or loss
2019 2018
GBP'000 GBP'000
-------------------------------------------------- -------- --------
Quoted at fair value:
United Kingdom 281,795 283,171
Overseas 15,677 14,726
-------------------------------------------------- -------- --------
Total quoted investments 297,472 297,897
Treasury bills at fair value 90,893 95,612
Unquoted and loan stock at fair value 112,331 95,403
-------------------------------------------------- -------- --------
Investments at fair value through profit or loss 500,696 488,912
-------------------------------------------------- -------- --------
Listed AIM Unquoted Loan Treasury
equities quoted equities stocks Bills Total
2019 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------------------ ---------- --------- ---------- --------- ---------- ----------
analysis of investment portfolio movements
Opening bookcost as at 1 February 2018 67,505 88,368 35,815 33,447 100,480 325,615
Opening unrealised appreciation/(depreciation) 130,168 11,856 26,756 (615) (4,868) 163,297
------------------------------------------------ ---------- --------- ---------- --------- ---------- ----------
opening valuation as at 1 February 2018 197,673 100,224 62,571 32,832 95,612 488,912
Movements in year:
Transfer (2) 2 (3,584) 3,584 - -
Purchases at cost 39,085 31,190 11,808 23,020 310,956 416,059
Sales - proceeds (67,016) (15,238) (13,414) (16,433) (323,269) (435,370)
- realised gains on sales 35,785 22 12,045 1,110 4,732 53,694
(Decrease)/increase in appreciation on assets
held (30,706) 6,453 (2,097) 889 2,862 (22,599)
------------------------------------------------ ---------- --------- ---------- --------- ---------- ----------
closing valuation as at 31 January 2019 174,819 122,653 67,329 45,002 90,893 500,696
------------------------------------------------ ---------- --------- ---------- --------- ---------- ----------
Closing bookcost as at 31 January 2019 75,357 104,344 42,670 44,728 92,899 359,998
Closing unrealised appreciation/(depreciation) 99,462 18,309 24,659 274 (2,006) 140,698
------------------------------------------------ ---------- --------- ---------- --------- ---------- ----------
174,819 122,653 67,329 45,002 90,893 500,696
------------------------------------------------ ---------- --------- ---------- --------- ---------- ----------
Listed AIM Unquoted Loan Treasury
equities quoted equities stocks Bills Total
2018 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------------------ ---------- --------- ---------- --------- ---------- ----------
analysis of investment portfolio movements
Opening bookcost as at 1 February 2017 48,538 44,182 32,477 57,317 118,221 300,735
Opening unrealised appreciation/(depreciation) 68,675 7,087 37,505 2,090 (1,474) 113,883
------------------------------------------------ ---------- --------- ---------- --------- ---------- ----------
opening valuation as at 1 February 2017 117,213 51,269 69,982 59,407 116,747 414,618
Movements in year:
Transfer 1,922 - 5,338 (7,260) - -
Purchases at cost 37,252 56,565 16,371 12,430 327,985 450,603
Sales - proceeds (44,087) (19,632) (14,840) (29,067) (337,880) (445,506)
- realised gains/(losses) on sales 23,880 7,253 (3,531) 27 (7,846) 19,783
Increase/(decrease) in appreciation on assets
held 61,493 4,769 (10,749) (2,705) (3,394) 49,414
------------------------------------------------ ---------- --------- ---------- --------- ---------- ----------
closing valuation as at 31 January 2018 197,673 100,224 62,571 32,832 95,612 488,912
------------------------------------------------ ---------- --------- ---------- --------- ---------- ----------
Closing bookcost as at 31 January 2018 67,505 88,368 35,815 33,447 100,480 325,615
Closing unrealised appreciation/(depreciation) 130,168 11,856 26,756 (615) (4,868) 163,297
------------------------------------------------ ---------- --------- ---------- --------- ---------- ----------
197,673 100,224 62,571 32,832 95,612 488,912
------------------------------------------------ ---------- --------- ---------- --------- ---------- ----------
2019 2018
GBP'000 GBP'000
-------------------------------------- --------- --------
analysis of capital gains and losses
Gains on sales 53,694 19,783
Unrealised (losses)/gains (22,599) 49,414
-------------------------------------- --------- --------
gains on investments at fair value 31,095 69,197
-------------------------------------- --------- --------
2019 2018
GBP'000 GBP'000
------------------------------------------------------- -------- --------
Exchange gains/(losses) on capital items 183 (293)
Exchange gains/(losses) on capital items and currency 88 (476)
------------------------------------------------------- -------- --------
exchange gains/(losses) 271 (769)
------------------------------------------------------- -------- --------
2019 2018
GBP'000 GBP'000
----------------------------------- -------- --------
Portfolio analysis
Equity shares 360,368 354,184
Convertible preference securities 4,433 6,284
Fixed interest securities 45,002 32,832
Treasury Bills 90,893 95,612
----------------------------------- -------- --------
500,696 488,912
----------------------------------- -------- --------
b) subsidiary undertakings
At 31 January 2019 the Company has the following
Subsidiaries:
Subsidiary Principal activity Equity held Country of registration
--------------------------------------- -------------------------- ------------ -------------------------
Consolidated Venture Finance Limited* Investment entity 100.0% England and Wales
Hampton Investment Properties Limited Property investment 70.8% England and Wales
Harwood Leeds Property Property investment 100.0% England and Wales
Oryx International Growth Fund Limited Investment company 51.9% Guernsey
Performance Chemical Company Oil field service company 53.1% United States of America
--------------------------------------- -------------------------- ------------ -------------------------
These subsidiaries were active during the year.
* Directly held by the Company at a cost of less than
GBP1,000.
assessment as an investment entity
Entities that meet the definition of an investment entity within
IFRS 10 Consolidated Financial Statements, are required to measure
their subsidiaries at fair value through profit or loss rather than
consolidate the entities. The criteria which define an investment
entity are as follows:
-- an entity that obtains funds from one or more investors for
the purpose of providing those investors with investment
services;
-- an entity that commits to its investors that its business
purpose is to invest funds solely for returns from capital
appreciation, investment income or both; and
-- an entity that measures and evaluates the performance of
substantially all of its investments on a fair value basis.
Upon initial adoption of IFRS 10, the Board concluded that the
Company met the additional characteristics of an investment entity
in that it has more than one investment, it has ownership interests
in the form of equity and similar interests, it has more than one
investor and its investors are not related parties.
Following the adoption of IFRS 10 amendments effective for
periods starting after 1 January 2016, all investments are now
recognised at fair value through profit or loss, including those
investments that had previously been consolidated.
The Company has only one subsidiary, CVF, which had been
consolidated under IAS 27 previously and is now included at fair
value through profit or loss. Had the Company consolidated CVF the
Group accounts would be identical to the Company only accounts,
with the exception of the following immaterial historical
differences.
Bookcost: there would be a difference between the Company's
carried forward bookcost of GBP359,998,000 with the Group's carried
forward bookcost due to an historical sale from CVF to NASCIT. Had
the accounts been consolidated the Group's carried forward bookcost
would have been GBP359,956,000.
Capital and revenue reserves: there would be differences between
the Company's carried forward capital and revenue reserves
(GBP524,316,000 and GBP4,914,000, respectively) with the Group's
carried forward capital and revenue reserves due to historical CVF
transactions. Had the accounts been consolidated the Group's
carried forward capital and revenue reserves would have been
positive GBP524,669,000 and GBP4,516,000, respectively.
c) significant holdings
At the year-end, the Company held 20% or over of the aggregate
nominal value of voting equity of the following companies:
Revenue Company Company
reserves for holding holding
Capital and the last 31 January 31 January
Country of incorporation reserves financial year 2019 2018
Company and address of principal business and registration Year end GBP'000 GBP'000 % %
AssetCo plc 30
Singleton Court Business Park, Wonastow September
Road, Monmouth, Monmouthshire NP25 5JA England and Wales 2017 29,970,000 1,419,000 28.63 28.63
Consolidated Venture Finance Limited
6 Stratton Street, Mayfair, London W1J 31 January
8LD England and Wales 2018 (745,000) (745,000) 100.00 100.00
EKF Diagnostics Holdings plc 31
Avon House, 19 Stanwell Road, Penarth, December
Cardiff CF64 2EZ England and Wales 2017 81,380,000 10,299,000 21.58 21.42
Hampton Investment Properties Limited 31
6 Stratton Street, Mayfair, London W1J December
8LD England and Wales 2016 12,530,826 (644,891) 70.81 70.81
Harwood Leeds Property
6 Stratton Street, Mayfair, London W1J 31 August
8LD England and Wales 2018 9,433,473 (82,499) 100.00 100.00
Harwood Private Equity Fund IV LP 31
6 Stratton Street, Mayfair, London W1J December
8LD England and Wales 2017 109,184,284 1,382,625 26.28 26.23
Oryx International Growth Fund Limited
BNP Paribas House, St Julian's Avenue, 31 March
St Peter Port, Guernsey GY1 1WA Guernsey 2017 125,241,513 10,530,176 51.86 50.28
30
Performance Chemical Company September
9105 W Interstate 20 Midland TX 79706 United States of America 2017 $12,218,258 $347,503 53.12 53.10
Ten Entertainment Group Plc 31
Head Office, Tenpin Ltd, Aragon House, December
Bedford, MK43 OEQ England and Wales 2017 54,908,000 10,669,000 23.08 30.77
Trident Private Equity Fund III LP 31
6 Stratton Street, Mayfair, London W1J December
8LD England and Wales 2017 17,451,554 81,135 38.72 38.76
All the investments detailed above have not been consolidated
into the financial statements due to the Company meeting the
definition of an investment entity under IFRS 10 and therefore
these investments are included at fair value through profit and
loss.
d) investments in US treasury bills
At 31 January 2019, the Company held US Treasury Bills with a
market value of GBP90,893,000 (2018: GBP95,612,000).
e) transaction costs
During the year, the Company incurred total transaction costs of
GBP226,000 (2018: GBP399,000) comprising GBP68,000 (2018:
GBP271,000) and GBP158,000 (2018: GBP128,000) on purchases and
sales of investments respectively. These amounts are included in
gains on investments as disclosed in the Statement of Comprehensive
Income.
f) material disposals of unlisted investments in the year:
Carrying value at
Proceeds Bookcost Gain/(loss) 31 January 2018
Security Name GBP'000 GBP'000 GBP'000 GBP'000
-------------------------------------------------- --------- --------- ------------ ------------------
Trident Private Equity Fund III 10,777 1,024 9,753 16,621
Jaguar Holdings, Loan Notes 4,742 4,737 5 4,219
Coventbridge Loan Notes 7,110 7,110 - 5,626
Sherwood Holdings PIK Loan Notes 1,966 1,966 - n/a
Curtis Gilmore Equipment Loan Notes 5,225 4,121 1,104 4,306
Curtis Gilmore Equipment Common Stock 1,878 6 1,872 2,011
Curtis Gilmore Equipment Non-Div Redeemable Pref 407 339 68 365
-------------------------------------------------- --------- --------- ------------ ------------------
The information on exit strategy for the invested companies is
confidential and in most cases the likely exit is a sale to a trade
or financial buyer at an uplifted multiple on increased
profits.
9 trade and other receivables
2019 2018
GBP'000 GBP'000
----------------------------- -------- --------
Amounts due from brokers 17,103 -
Amounts owed by Subsidiary 89 82
Accrued income 542 1,422
Other debtors 959 926
Recoverable withholding tax 930 1,513
----------------------------- -------- --------
19,623 3,943
----------------------------- -------- --------
10 trade and other payables
2019 2018
GBP'000 GBP'000
------------------------------ -------- --------
Investment Manager's fees 255 219
Performance fees 2,091 3,071
Amounts due to brokers 16,988 623
Other creditors and accruals 229 172
------------------------------ -------- --------
19,563 4,085
------------------------------ -------- --------
11 share capital
2019 2019 2018 2018
Number GBP'000 Number GBP'000
------------------------------ ----------- -------- ----------- --------
- authorised:
Ordinary Shares of 5p: 27,000,000 1,350 27,000,000 1,350
- issued and fully paid:
Ordinary Shares of 5p:
Balance at beginning of year 14,425,620 721 14,425,620 721
Cancellation of shares (100,000) (5) - -
------------------------------ ----------- -------- ----------- --------
Balance at end of year 14,325,620 716 14,425,620 721
------------------------------ ----------- -------- ----------- --------
Since 31 January 2019, no Ordinary Shares have been purchased by
the Company for cancellation. As at the date of this report, the
Company's issued share capital consists of 14,325,620 Ordinary
Shares of 5p nominal value each.
There are contingent rights to subscribe for Ordinary Shares of
5p each pursuant to:
There are Options totalling 10,000 (2018: 30,000) remaining,
details of which are given in note 5 above.
12 reconciliation of total return before taxation to cash
generated from operations
2019 2018
GBP'000 GBP'000
--------------------------------------------------- --------- ---------
Total return before taxation 35,418 70,828
Gains on investments (31,366) (68,428)
Dividends and interest reinvested (3,500) (2,450)
Share option discharge (496) -
Movement in provision for subsidiary (7) (82)
Increase/(decrease) in debtors and accrued income 847 (804)
(Decrease)/increase in creditors and accruals (887) 3,105
--------------------------------------------------- --------- ---------
Cash generated from operations 9 2,169
--------------------------------------------------- --------- ---------
13 analysis of net cash and net debt
At At
1 February Cash Exchange 31 January
net cash 2018 flow movement 2019
GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- ------------ -------- ---------- ------------
Cash and cash equivalents 10,653 19,928 88 30,669
--------------------------- ------------ -------- ---------- ------------
14 financial instruments and risk profile
During the year, the Board has undertaken a review of the risks
facing the Company. An explanation of the Company's financial risk
management objectives, policies and strategy can be found in the
Strategic Report in the Annual Report.
The Company's financial instruments comprise its investment
portfolio, cash balances, loan stock and trade receivables and
trade payables that arise directly from its operations. Note 1
above sets out the accounting policies, including criteria for
recognition and the basis for measurement, applied to significant
financial instruments (excluding cash at bank and bank loans) which
are carried at fair value. Note 1 also includes the basis on which
income and expenses arising from financial assets and liabilities
are recognised.
The main risks arising from the Company's financial instruments
are:
(i) market price risk, including currency risk, interest rate
risk and other price risk;
(ii) liquidity risk; and
(iii) credit risk
The Company Secretary in close co-operation with the Board of
Directors and the Manager, co-ordinates the Company's risk
management. The policies for managing each of these risks are
summarised below and have been applied throughout the year.
(i) market price risk
The fair value or future cash flows of a financial instrument
held by the Company may fluctuate because of changes in market
prices. This market risk comprises currency risk, interest rate
risk and other price risk. The Board of Directors reviews and
agrees policies for managing these risks, which policies have
remained substantially unchanged from those applying in the prior
year. The Manager assesses the exposure to market risk when making
each investment decision and monitor the overall level of market
risk on the whole of the investment portfolio on an ongoing
basis.
currency risk
The Company's total return and net assets can be materially
affected by currency translation movements as a significant
proportion of the Company's assets are denominated in currencies
other than Sterling, which is the Company's functional currency. It
is not the Company's policy to hedge this risk on a continuing
basis but the Company may, from time to time, match specific
overseas investment with foreign currency borrowings. The Manager
seeks, when deemed appropriate, to manage exposure to currency
movements on borrowings by using forward foreign currency contracts
as a hedge against potential foreign currency movements. At 31
January 2019, the Company had no open forward currency contracts
(2018: none).
The revenue account is subject to currency fluctuation arising
on overseas income. The Company does not hedge this currency
risk.
Foreign currency exposure by currency of denomination:
31 January 2019 31 January 2018
Overseas Net monetary Total currency Overseas Net monetary Total currency
investments assets exposure investments assets exposure
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------- ------------- ------------- --------------- ------------- ------------- ---------------
US Dollar 141,873 2,410 144,283 150,273 4,614 154,887
Euro 6,981 - 6,981 - - -
----------- ------------- ------------- --------------- ------------- ------------- ---------------
148,854 2,410 151,264 150,273 4,614 154,887
----------- ------------- ------------- --------------- ------------- ------------- ---------------
Sensitivity analysis is based on the Company's monetary foreign
currency financial instruments held at each balance sheet date. If
Sterling had moved by 10% against all currencies, with all other
variables constant, net assets would have moved by the amounts
shown below. The analysis is shown on the same basis for 2018.
31 January 2019 31 January 2018
10% weakening 10% strengthening 10% weakening 10% strengthening
GBP'000 GBP'000 GBP'000 GBP'000
US Dollar 16,031 (13,117) 17,210 (14,081)
Euro 776 (635) - -
----------- -------------- ------------------ -------------- ------------------
16,807 (13,752) 17,210 (14,081)
----------- -------------- ------------------ -------------- ------------------
In the opinion of the Directors, the above sensitivity analyses
are not representative of the year as a whole, since the level of
exposure changes frequently as part of the currency risk management
process used to meet the Company's objectives.
interest rate risk
Interest rate movements may affect;
-- the fair value of the investments in fixed interest rate
securities (including unquoted loans);
-- the level of income receivable on cash deposits;
The possible effects on fair value and cash flows that could
arise as a result of changes in interest rates are taken into
account when making investment decisions.
The Board reviews on a regular basis the values of the fixed
interest rate securities and the unquoted loans to companies in
which private equity investment is made.
The Company finances part of its activities through borrowings
at levels approved and monitored by the Board.
Movements in interest rates would not significantly affect net
assets attributable to the Company's Shareholders and total
profit.
other price risk
Other price risks (i.e. changes in market prices other than
those arising from currency risk or interest rate risk) may affect
the value of the quoted and unquoted investments.
The Company's exposure to 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. As at the year-end, the spread of the
Company's investment portfolio analysed by sector as set out
earlier in the Report.
The Board of Directors manages the market price risks inherent
in the investment portfolios by ensuring full and timely access to
relevant investment information from the Manager. The Board meets
regularly and at each meeting reviews investment performance. The
Board monitors the Manager's compliance with the Company's
objectives and is directly responsible for investment strategy and
asset allocation.
When appropriate, derivative contracts are used to hedge against
the exposure to price risk.
The Company's exposure to other changes in market prices at 31
January 2019 on its quoted and unquoted investments and options on
investments was as follows:
2019 2018
GBP'000 GBP'000
---------------------------------------------------------------- -------- --------
Financial assets at fair value through profit or loss
- Non current investments at fair value through profit or loss 500,696 488,912
---------------------------------------------------------------- -------- --------
As mentioned in the accounting policies notes, the Private
equity investments have been valued following the IPEV Valuation
Guidelines. The valuation incorporates all relevant factors that
market participants would consider in setting a price.
Methods applied include cost of investment, price of recent
investments, net assets and earnings multiples. Any valuations in
local currency are converted into sterling at the prevailing
exchange rate on the valuation date.
Although the Manager believes that the estimates of fair values
are appropriate, the use of different methodologies or assumptions
could lead to different measurements of fair values.
Subsequent adjustments in price are determined by the Manager's
Valuation and Pricing Committee.
The table below shows how the most significant unquoted
investments have been valued as at 31 January 2019.
2019 fair 2018 fair
Method of fair value GBP value GBP
value valuation GBP'000 GBP'000
---------------------------------------------------- -------------------- ----------- -----------
Harwood Private Equity IV LP Net Assets 31,569 14,503
Sherwood Holdings - Loan Cost 17,131 15,165
Performance Chemical Company Ordinary Valuation Multiple 13,815 12,776
Harwood Leeds Property Fair Value 9,516 3,584
Coventbridge Group - Loan Cost 7,604 5,626
Pelsis Holding (Hamsard 3468) - A1 Loan Notes Cost 2,780 n/a
Pelsis Holding (Hamsard 3468) - A2 Loan Notes Cost 4,169 n/a
Pelsis Holding (Hamsard 3468) - A4 Ordinary shares Cost 32 n/a
Trident Private Equity Fund III LP Net Assets 6,339 16,261
Jaguar Holdings - Preferred Valuation Multiple 2,167 2,004
Jaguar Holdings - Ordinary Valuation Multiple 3,042 422
Viking Investments Cost 4,411 4,411
Utitec Holdings Cost 3,802 3,516
GAJV Holdings - Ordinary shares Valuation Multiple - 215
GAJV Holdings - CD Cost 1,142 250
GAJV Holdings - Preferred Cost 404 2,650
WEP Superior Industrial Maintenance Co Cost 1,521 n/a
Hampton Investment Properties Limited Cost 995 995
---------------------------------------------------- -------------------- ----------- -----------
110,439 93,280
------------------------------------------------------------------------- ----------- -----------
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 difference 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 should be adjusted.
Further detail on the valuation of significant investments, are
detailed below:
Trident Private Equity Fund III LP (TPE3) and Harwood Private
Equity IV LP (HPE4)
Held at net asset value, derived from the audited financial
statements of the Funds, as the underlying investments within TPE3
and HPE4 are valued on a fair value basis. The Directors believe
that the movement between the Funds' measurement dates and the
reporting dates are not material. As the funds have no debts, a
change of 10% in the underlying assets would have a 10% impact on
the Funds' carrying value.
Performance Chemical Company - Ordinary Shares, Preferred
Shares, Loan
The enterprise value is calculated based on an EBITDA multiple
of 6.9x. A reduction in the multiple by a factor of 1x would reduce
the carrying value of the total investment by US$3.0 million, or
-16%. An increase in the multiple by a factor of 1x would increase
the value of the total investment by US$3.0 million, or 16%. The
preference shares are held at cost.
Coventbridge Group - Loan
The loan is held at par plus accrued interest.
Sherwood Holdings Limited - Loan
The loan is held at par plus accrued interest on a semi-annual
basis.
Harwood Leeds Property
The investment has been valued at the equity cost (GBP9.45m)
with the underlying properties valued by an independent valuer
(Savills plc) at GBP17.25m. The valuation of the properties
represents fair value taking into consideration the transaction
cost, market conditions and the pricing risks. A 5% decrease in the
market value of the properties would decrease the investment value
by GBP0.8625m or 9%, once debt is deducted.
Management have performed other assessments, including multiples
and nets assets and concluded that the fair value derived from
those methods is not significantly different from costs.
The following table illustrates the sensitivity of the profit
after taxation and net assets to an increase or decrease of 10% in
the fair values of the Company's investments. This level of change
is considered to be reasonably possible based on observation of
current market conditions. The sensitivity analysis is based on the
Company's equities and equity exposure through options at each
Balance Sheet date, with all other variables held constant.
2019 2018
Increase in Decrease in Increase in Decrease in
fair value fair value fair value fair value
GBP'000 GBP'000 GBP'000 GBP'000
----------------------------------- ------------ ------------ ------------ ------------
Increase/(decrease) in net assets 50,070 (50,070) 48,891 (48,891)
----------------------------------- ------------ ------------ ------------ ------------
(ii) liquidity risk
This is the risk that the Company will encounter difficulty in
meeting obligations associated with financial liabilities.
The Company invests in equities and other investments that are
readily realisable. It also invests in unquoted securities, which
are less readily marketable than equities. These investments are
monitored by the Board on regular basis.
The majority of the Company's cash is held in short-term
Treasury Bills, which are highly liquid. As a consequence, the
Company could access in excess of GBP91 million based on current
exchange rates, within one week.
(iii) credit risk
Other than its investment in government gilts, 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 they
are neither past due or impaired.
The maximum exposure of the financial assets to credit risk at
the Balance Sheet date was as follows:
2019 2018
GBP'000 GBP'000
----------------------------------------------- -------- --------
financial assets neither past due or impaired
Fixed income securities 45,002 32,832
Preference shares 4,433 6,284
Treasury Bills 90,893 95,612
Accrued income and other debtors 19,623 3,943
Cash and cash equivalents 30,669 10,653
----------------------------------------------- -------- --------
190,620 149,324
----------------------------------------------- -------- --------
The maximum credit exposure of financial assets represents the
carrying amount.
There are no financial assets that are past due or impaired.
commitments giving rise to credit risk
There are no commitments giving rise to credit risk as at 31
January 2019.
fair value of financial assets and financial liabilities
The fair value for each class of financial assets and
liabilities of the Company, compared with the corresponding amount
in the Balance Sheet was as follows (trade receivables and trade
payables, are excluded from the comparison, as their carrying
amounts are a reasonable approximation of their fair value).
31 January 2019 31 January 2018
Fair value Balance Sheet value Fair value Balance Sheet value
GBP'000 GBP'000 GBP'000 GBP'000
financial assets
Financial assets at fair value through profit
or loss
- Non current assets 500,696 500,696 488,912 488,912
Loans and receivables
- Cash and cash equivalents 30,669 30,669 10,653 10,653
------------------------------------------------ ----------- -------------------- ----------- --------------------
531,365 531,365 499,565 499,565
------------------------------------------------ ----------- -------------------- ----------- --------------------
There have been no financial liabilities in the financial year's
ending 31 January 2019 and 31 January 2018.
fair values are derived as follows:
- Where assets and liabilities are denominated in a foreign
currency, they are converted into Sterling using year-end rates of
exchange.
- Non current financial assets (non current and held for
trading) - as set out in the accounting policies.
- Cash and cash equivalents, bank overdraft and bank loans - at face value of the account.
The Company adopted the amendment to IFRS 13, effective 1
January 2009. 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.
An active market is a market in which transactions for the asset
or liability occur with sufficient frequency and volume on an
ongoing basis such that quoted prices reflect prices at which an
orderly transaction would take place between market participants at
the measurement date. Quoted prices provided by external pricing
services, brokers and vendors are included in Level 1, if they
reflect actual and regularly occurring market transactions on an
arms length basis.
-- 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). See note 1e)
for details on how the value of level 3 investments are
calculated.
The Company's main unobservable inputs are earnings multiples,
recent transactions and net asset basis. The market value would be
sensitive to movements in these unobservable inputs. Movements in
these inputs, individually or in aggregate could have a significant
effect on the market value. The effect of such a change or a
reasonable possible alternative would be difficult to quantify as
such data is not available.
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 of financial
assets in accordance with the IFRS 13 fair value hierarchy
system:
financial assets at fair value through profit or loss
At 31 January 2019
Total Level 1 Level 2 Level 3
GBP'000 GBP'000 GBP'000 GBP'000
---------------------------- -------- -------- -------- --------
Equity investments 364,801 297,472 - 67,329
Fixed interest investments 135,895 90,893 - 45,002
---------------------------- -------- -------- -------- --------
Total 500,696 388,365 - 112,331
---------------------------- -------- -------- -------- --------
At 31 January 2018
Total Level 1 Level 2 Level 3
GBP'000 GBP'000 GBP'000 GBP'000
---------------------------- -------- -------- -------- --------
Equity investments 360,468 297,897 - 62,571
Fixed interest investments 128,444 95,612 - 32,832
---------------------------- -------- -------- -------- --------
Total 488,912 393,509 - 95,403
---------------------------- -------- -------- -------- --------
A reconciliation of fair value measurements in Level 3 is set
out below.
level 3 financial assets at fair value through profit or
loss
group and company
At 31 January 2019
Fixed
Equity interest
Total investments investments
GBP'000 GBP'000 GBP'000
----------------------------------------------------------------------------- --------- ------------- -------------
Opening Balance 95,403 62,571 32,832
Purchases 34,828 11,808 23,020
Sales (29,847) (13,414) (16,433)
Transfer - (3,584) 3,584
Total gains/(losses) included in gains on investments in the Statement of
Comprehensive Income:
- on assets sold 13,155 12,045 1,110
- on assets held at the end of the year (1,208) (2,097) 889
----------------------------------------------------------------------------- --------- ------------- -------------
Closing balance 112,331 67,329 45,002
----------------------------------------------------------------------------- --------- ------------- -------------
Harwood Private Equity became a loan during the year.
capital management policies and procedures
The Company's capital management objectives are:
- to ensure that the Company will be able to continue as a going concern; and
- to maximise the income and capital return to its equity
Shareholders through an appropriate balance of equity capital and
debt. The policy is that gearing should not exceed 30% of net
assets.
The Company's capital at 31 January comprises:
2019 2018
GBP'000 GBP'000
-------------------------------------- -------- --------
Debt - -
Equity
Equity share capital 716 721
Retained earnings and other reserves 530,709 498,702
-------------------------------------- -------- --------
531,425 499,423
-------------------------------------- -------- --------
Debt as a % of net assets 0.0% 0.0%
capital management policies and procedures
The Board, with the assistance of the Manager monitor and
reviews the broad structure of the Company's capital on an ongoing
basis. This review includes:
- the planned level of gearing, which takes account of the Manager's views on the market;
- the need to buy back equity Shares for cancellation, which
takes account of the difference between the net asset value per
share and the Share price (i.e. the level of share price discount
or premium);
- the need for new issues of equity Shares; and
- the extent to which revenue in excess of that which is
required to be distributed should be retained.
The Company's objectives, policies and processes for managing
capital are unchanged from the preceding accounting period.
15 related party transactions
Harwood Capital LLP is regarded as a related party of the
Company due to Christopher Mills, the Company's Chief Executive and
Investment Manager being a member of Harwood Capital LLP until 9
June 2015 and the ultimate beneficial owner. Harwood Capital LLP
acts as Investment Manager or Investment Adviser of the following
companies in which the Company has an investment and from which
companies it receives fees or other incentives for its
services:
Services Fees
--------------------------------------- -------------------- -------------
Oryx International Growth Fund Limited Investment Advisory GBP1,688,648
Trident Private Equity III LP Investment Advisory GBP200,348
Harwood Private Equity IV LP Investment Advisory GBP3,050,000
--------------------------------------- -------------------- -------------
The amounts payable to the Manager are disclosed in note 3. The
relationships between the Company, its Directors and the Manager
are disclosed in the Report of the Directors in the Annual
Report.
Christopher Mills is Chief Executive Officer and indirectly a
member of Harwood Capital LLP. He is also a director of Oryx. GFS
is a wholly-owned subsidiary of Harwood Capital Management Limited,
which is the holding company of the Harwood group of companies and
is, in turn, 100% owned by Christopher Mills. Harwood Capital
Management Limited is also a Designated Member of Harwood Capital
LLP, the Manager of the Company.
disclosure of interests
Christopher Mills is also a director of the following companies
in which the Company has an investment or may have had in the year
and/or from which he may receive fees or hold shares: AssetCo plc,
Augean plc, Bigblu Broadbank plc, Bioquell plc, Curtis Gilmour
Holding Company, Goals Soccer Centres plc, M J Gleeson Group plc,
Oryx, Pelsis/Hamsard, Renalytix AI Plc, Sunlink Health Systems Inc
and Ten Entertainment Group plc. Employees of the Manager may hold
options over shares in investee companies. A total of GBP306,200 in
directors fees was received by Christopher Mills during the year
under review.
No formal arrangements exist to avoid double charging on
investments held by the Company which are also managed or advised
by Christopher Mills (Chief Executive) and/or Harwood Capital LLP.
Members and certain private clients of Harwood Capital LLP, and its
associates (excluding Christopher Mills and his family) hold 73,343
shares in the Company (2018: 40,843).
Members, employees, institutional clients and private clients of
Harwood Capital LLP may co-invest in the same investments as the
Company.
From time to time Directors may co-invest in the same
investments as the Company.
transactions with other companies
The Company owns 100% of the GBP1 Ordinary Shares in CVF, and as
at 31 January 2019 amounts due from CVF were GBPnil (2018:
GBPnil).
Full details of related companies of the Company can be found in
note 8.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR CKKDBOBKDKPB
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May 20, 2019 13:24 ET (17:24 GMT)
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