TIDMJDT
RNS Number : 2382L
Jupiter Dividend & Growth Trust PLC
29 September 2016
Jupiter Dividend & Growth Trust PLC
Half-Yearly Financial Report for the six months to 30 June 2016
(unaudited)
Financial Highlights
Performance
As at As at
30.06.16 31.12.15 % Change
Total assets less current
liabilities (GBP'000) 50,884 53,957 -5.7
FTSE All-Share Index
(Capital) 3,515.45 3,444.26 +2.1
FTSE All-Share Index
(Total Return) 5,737.47 5,502.42 +4.3
Share Performance
As at As at
30.06.16 31.12.15 % Change
Zero Dividend Preference
shares
Mid-market price (pence) 115.75 114.75 +0.9
Net Asset Value (pence) 124.44 131.73 -5.5
Discount (%) (7.0) (12.9)
Ordinary Income shares
Mid-market price (pence) 3.00 3.63 -17.4
Net Asset Value (pence) 0.97 1.13 -14.2
Premium (%) 209.3 221.2
Common shares
Mid-market price (pence) 116.50 120.50 -3.3
Net Asset Value (pence) 127.32 134.45 -5.3
Discount (%) (8.5) (10.4)
Revenue Performance
Six months Six months
to 30.06.16 to 30.06.15 % Change
Revenue after taxation
due to Ordinary
Income shareholders
(GBP'000) 698 784 -11.0
Return per Ordinary
Income share (p) 0.76 0.85 -10.6
Return per Common share
(p)
(shown within revenue
finance costs) 2.12 2.46 -13.8
Chairman's Statement
Performance
The total assets less current liabilities of your Company fell
by 5.7 per cent. to GBP50,884,000 during the six months to 30 June
2016. By comparison, the Company's benchmark index, the FTSE
All-Share Index, rose by 2.1 per cent. (in capital terms) during
the same period.
The period up to the end of June incorporated the unexpected
outcome of the UK's referendum on EU membership and the concomitant
sharp sell-off in equities. In particular, the shares of
domestically-exposed companies such as housebuilders, retailers and
banks fell sharply on fears of an immediate UK recession and a
squeeze on profit margins with higher input costs from the sharp
decline in the value of the pound.
Although longer-term uncertainty remained, the swift appointment
of a new prime minister helped calm equity markets (which at the
time of writing are now higher than before the vote). The shares of
overseas earners who translate their overseas profits back into
substantially higher sterling-denominated profits rallied most
strongly; your Company has some exposure to healthcare, tobacco and
oil companies - these have benefitted. The Company's
domestically-exposed companies have partially (but not yet fully)
recovered and we are awaiting greater clarity on how consumer and
business behaviour will develop in the coming months and the extent
to which the Bank of England and perhaps the Government will
introduce stimulatory measures to shore up confidence with the aim
of avoiding a "self-induced" recession.
Share Price Performance
The Net Asset Value of the Common shares decreased by 5.3 per
cent. during the period under review from 134.45p to 127.32p
(including income and expenses).
The Net Asset Value of the Zero Dividend Preference shares
('ZDPs') decreased by 5.5 per cent. during the period under review
from 131.73p to 124.44p*, while the discount on the ZDPs moved from
12.9 per cent. to 7.0 per cent. over the period.
Due to the Company's geared capital structure, any fall in the
Company's total assets is borne first by the Ordinary Income
shares. The effect of gearing is that in rising markets the asset
value of the Ordinary Income shares benefits from any
outperformance of the Company's investment portfolio over and above
the cost of the fixed entitlements of the Company's ZDPs and Common
shares.
Conversely, when the Company's total assets fall, the Ordinary
Income shares suffer to the extent of any shortfall between the
return on the Company's investment portfolio and the cost of the
fixed entitlements of the Company's ZDPs and Common shares.
Furthermore, when the value of the assets falls severely, the fixed
entitlements of the Company's ZDPs and Common shares may not be
entirely covered.
The annual hurdle rate required to repay the ZDPs on 30 November
2017 was 12.3 per cent. as at 30 June 2016. The ZDPs were covered
by a factor of 0.8.
As at 30 June 2016, there is currently a small capital value of
0.28p per share accrued to the Company's Ordinary Income shares,
due to the revenue reserves attributable to the Company which are
available for distribution as future dividends.
* The notional accrued entitlement of the ZDP shares at 30 June
2016 was 124.44p.
Revenue and Dividends
The Company's revenues after tax for the period amounted to
GBP698,000. The revenue return per Ordinary Income share and Common
share was 0.76p and 2.12p respectively.
During the period under review the following quarterly dividends
were declared in respect of the year ending 31 December 2016:
1st interim dividend
Date Record Pay
declared Rate date date
Shares 2016 (net) 2016 2016
Common shares 12 April 1.26p 22 April 20 May
Ordinary Income
shares 12 April 0.45p 22 April 20 May
2nd interim dividend
Date Record Pay
declared Rate date date
Shares 2016 (net) 2016 2016
Common shares 14 June 1.26p 22 July 19 August
Ordinary Income 22 July 19 August
shares 14 June 0.45p
Dividends on the Ordinary Income and Common shares are paid in
Sterling, quarterly in arrears. From time to time, subject to the
requirements of the Corporation Tax Act 2010 the Directors may
retain income in the revenue reserves of the Company with a view to
producing a consistent level of dividend for Ordinary Income and
Common shareholders in subsequent accounting periods.
Outlook
The UK stock market has mostly recovered from the shock of
Britain's vote to leave the EU. The political vacuum that appeared
immediately after the vote together with the temporary suspension
of dealing by several large commercial property funds with its
echoes of the 2008 financial crisis markedly increased nervousness
and the yield on one two-year gilt issue briefly turned negative
for the first time. However, the surprisingly quick formation of a
new cabinet removed much uncertainty at the margin.
The weak performance of the pound since the referendum result
reflects the prospects of an interest rate cut and increased
probability of a recession, although UK Q2 GDP was stronger than
expected. If the UK has had a minor heart attack then the sterling
devaluation should provide a resuscitating shot of adrenaline. The
weaker pound has boosted the overseas earnings of many blue chips;
British exporters are now more competitive and UK assets should be
more attractive to foreigners. For example, GlaxoSmithKline's
dividend now looks more secure and the pharmaceutical giant is to
invest in a major joint venture in bioelectronics at its R&D
centre in Stevenage as well as investing GBP275m in three of its UK
manufacturing sites.
In the immediate aftermath of the referendum, company trading
and outlook statements have been scrutinised closely for signs of
attrition but so far housebuilders have not reported cancellations
nor has ITV reported any major cancellation of advertising budgets
or any step change in spending patterns. Clearly, that could change
and the balance of risks remain on the downside. Although we have
seen some weakness in airline and travel companies this may be as
much about terrorism fears as it is about Brexit, if not more.
The economy is likely to slow in the coming months, perhaps
materially. However, your Company has been active to reflect the
extraordinary change in the economic environment and our
expectation is that there will be a range of policy initiatives to
boost the economy, which may include interest rate
reductions/monetary stimulus, housing market initiatives and
infrastructure spending. Such initiatives would be particularly
helpful for domestic companies, which are being priced for
recession. Whilst this is a possibility, your Company does not
regard the current environment as comparable to the 2008/9 global
financial crisis when the banking system was bust, there was no
availability of bank finance and business/consumer activity was in
freefall.
The authorities are mindful of the need for prompt and
supportive action. As a statement of intent we note that the chief
economist of the Bank of England was quoted as saying "I would
rather run the risk of taking a sledgehammer to crack a nut than
taking a miniature rock hammer to tunnel my way out of prison."
Even so, an unpredictable time clearly lies ahead and your
Company has responded by adjusting to a more defensive stance while
backing companies which are well positioned for further growth and
have the potential to deliver good returns and rising
dividends.
Martin Boase
Chairman
29 September 2016
Investment Adviser's Review
Market Review
In the period under review, the FTSE All Share Index (in capital
terms) and the FTSE 350 indices returned 2.1 per cent. and 7.5 per
cent. respectively, while the total assets of your Company returned
-5.7 per cent.
The year began with a plummet in the Chinese domestic equity
market and global investors were quick to price in further
scepticism about the country's credit bubble and its ability to
restructure its economy from being investment led to consumption
driven. In the US, markets grew perturbed by the prospect of the
Federal Reserve ('Fed') continuing to raise rates into a weakening
economy. However, in March a complete change of tone from the Fed
together with a rise in the oil price was enough to make markets
feel more relaxed (or at least less fearful) about the likelihood
of a further renminbi devaluation and most of the relative gains in
fixed interest were given back.
Although the UK labour market remained strong by historic
standards there were clear signs in manufacturing and in
construction that the domestic economy was slowing as investment,
hiring and spending plans were increasingly put on hold ahead of
the UK vote on continuing membership of the EU. Indeed, the latter
half of June was particularly volatile for equities as investors
responded to the fluctuating indications of opinion polls ahead of
the EU referendum and then immediately afterwards to the unexpected
result. Having rallied strongly in the days leading up to the vote
when polls implied no change to the status quo, the pound fell to a
30 year low against the US dollar as global investors took fright.
Although equity markets were quick to reprice global blue chip
businesses upwards as dollar earnings were worth more in pounds,
domestic stocks were marked down to reflect the greater likelihood
of a recession. Prices of domestic cyclicals were much more
volatile as market participants struggled to discount the likely
hit to the economy even though it was, of course, far too soon to
be able to tell.
Policy Review
The first quarter of 2016 was highly volatile as equity markets
underwent a bout of rotation arising from China's attempt to
reflate its economy. Although this was something we had been
expecting, nevertheless it was a sizeable headwind. For example,
your Company has long steered clear of mining stocks but these
bounced strongly from distressed prices after a weaker dollar
boosted commodity prices and led to a sector-wide bear squeeze,
e.g. Glencore and Anglo American rallied 75 per cent. and 83 per
cent. respectively in the quarter, while struggling supermarkets
Tesco and Morrison surged 27 per cent. and 32 per cent. (before
giving back their gains in the subsequent months). Your Company
owns none of these, so performance relative to the benchmark
suffered during the period. The rotation came at the expense of the
more reliable areas of the market which your Company does hold such
as BT and Ryanair. We remain distrustful of China's attempts to
successfully reflate by using ever more debt.
Tougher trading conditions hurt retailer Next, while Barclay's
surprise decision to half its dividend for the next two years also
contributed negatively. That said, there were strong returns from
Verizon, Imperial Brands, Royal Dutch Shell, Royal Mail and car
insurer esure, where a turning of the motor insurance cycle should
allow it to write more profitable business without diluting
underwriting standards. We took some profits in the latter when the
shares rose on a takeover rumour.
In early February we added to BP as we thought that pessimism
around the low oil price was overdone, the yield was highly
attractive and the dividend did not appear under immediate threat.
We also built up a position in Centrica which we think can deliver
solid dividend growth even if the oil price were to remain around
$35 a barrel for the next three years. We added to Conviviality as
its transformative takeover of Matthew Clark was delivering
synergies faster than expected.
We bought CYBG (Clydesdale & Yorkshire Bank). The shares
rose strongly following a decent set of maiden results. In our view
the shares were cheap on 0.6x book value given that the bank is
insulated against any past wrong doing via an agreement with its
former Australian parent. We sold retirement home builder McCarthy
& Stone following its initial public offering after the shares
rallied some 40 per cent. to a level we consider fully valued.
Following signs that the domestic economy was slowing we began
to reduce our exposure to banks such as Lloyds Banking Group and
businesses susceptible to a slowdown in consumer discretionary
spending such as N Brown and William Hill. We took some profits in
Cineworld as the shares were fully valued. A fair portion of the
portfolio was invested in domestic UK businesses which, albeit
cyclical, looked set to continue to deliver reasonable growth,
especially against a background of slower and more volatile global
growth. Indeed the UK economy delivered steady growth in the second
quarter of this year, growing 0.6 per cent. quarter on quarter.
This part of your Company was positioned to benefit from a Remain
vote which was our base expectation. Immediately following the
Leave vote domestic cyclicals such as housebuilders Crest Nicholson
and Galliford Try and ITV sold off sharply. This did not reflect
weaker trading, it was simply fear: fear of a recession in the
short term and fear of a weaker, slower-growing economy thereafter
in a prolonged period of uncertainty amid fractious political
negotiations. Following the quarter end, these stocks made
significant recoveries as companies confirmed that their current
trading appeared to be 'business as usual'.
Outlook
The unexpected result of the UK referendum on EU membership
represents a profound change in the country's relations with its
trading partners in Europe. A prolonged period of uncertainty seems
assured, not just for the UK but also for Europe and the rest of
the world.
Immediately following the result we acted swiftly to reduce some
of our pure domestic exposure due to lower conviction about their
immediate prospects. We cut positons such as Balfour Beatty
(construction) and Next as consumer spending is likely to slow
further, especially if sterling weakens further and businesses try
to pass on higher import costs. We also reduced our bank holdings
(Lloyds and Barclays). Not only are they likely to suffer from
higher loan impairments but lower interest rates will also squeeze
their margins and further defer the big expected step up in
dividend payments.
However, with an eye on oversold valuations, we added to some of
our higher conviction holdings (Crest Nicholson, Galliford Try) as
well as to life insurance. Shares in the latter have been sold off
as much as banks but we thought the yields are highly attractive
(7-8 per cent.) and sustainable given that Solvency II requirements
meant they have a strong capital positon and offered higher returns
on equity than the banks. Thus, we added to Legal & General
where a broadening of business opportunities in retirement and
direct investment should underpin steady growth in an already
attractive dividend. We think that housebuilders should benefit
from likely monetary and fiscal measures. They already have
attractive yields and should be able to continue their dividend
payments because unlike 2007/08 most are not geared and can
redirect cash from land purchases to dividends for a while. This
was one area of the stock market that saw strong insider buying
around the time of the Brexit vote.
Given the uncertainties that lie ahead and likely slowdown, we
are seeking to make your Company more defensive. In the UK, we have
made the portfolio more defensive and less reliant on discretionary
spending. So far, we have added to Centrica, Royal Mail and taken a
new position in BAE Systems.
We have also increased overseas exposure. We already have a
number of big overseas earners in the portfolio (AbbVie, Verizon)
but have added more (e.g. BAT) although we continue to shun the
highly-valued staples such as Unilever, Diageo and Reckitt
Benckiser. We opened new positons in Nokian Tyres and Novartis. The
former has a strong balance sheet, a high dividend yield and is
growing strongly in the US and western Europe. For consumers, tyres
are replacement, safety related purchases and not greatly affected
by economic conditions, but there is also a trend towards larger
wheels which mean more profitable tyres for manufacturers.
Novartis' shares were cheap in our view. After a period of weakness
we think the pharmaceutical is likely to recover helped by rising
sales of its new heart drug and a restructuring of its eye care
division. Besides representing good investments in their own right,
they can also help offset any further sterling depreciation which
might occur.
All things being equal, heightened uncertainty means heightened
volatility (temporary rallies, excesses of pessimism etc). We have
therefore raised the cash position to around 6 per cent. with a
view to taking advantage of the opportunities that we expect to
emerge under such circumstances.
Alastair Gunn
Fund Manager
Jupiter Asset Management Limited
Investment Adviser
29 September 2016
Investment Portfolio as at 30 June 2016
Market
value Percentage
Company Sector GBP'000 of Portfolio
BP Oil & Gas 3,066 6.2
Imperial Brands Consumer Goods 2,533 5.2
Royal Dutch Shell
'B' Oil & Gas 2,474 5.0
Vodafone Group Telecommunications 1,934 3.9
GlaxoSmithKline Health Care 1,764 3.6
British American
Tobacco Consumer Goods 1,695 3.5
AstraZeneca Health Care 1,675 3.4
Playtech Consumer Services 1,593 3.2
BT Group Telecommunications 1,538 3.1
HSBC Holdings Financials 1,399 2.9
AbbVie Health Care 1,389 2.8
esure Group Financials 1,359 2.8
WPP Consumer Services 1,318 2.7
Aviva Financials 1,300 2.6
CRH Industrials 1,200 2.4
Mondi Basic Materials 1,185 2.4
Micro Focus International Technology 1,128 2.3
Royal Mail Industrials 1,080 2.2
Centrica Utilities 1,048 2.1
Crest Nicholson Consumer Goods 1,032 2.1
Galliford Try Consumer Goods 1,003 2.0
Legal & General
Group Financials 953 1.9
Conviviality Consumer Services 905 1.8
Cineworld Group Consumer Services 900 1.8
ITV Consumer Services 899 1.8
Ryanair Holdings Consumer Services 853 1.7
Babcock International
Group Industrials 768 1.6
Verizon Communications Telecommunications 731 1.5
Prudential Financials 722 1.5
Standard Chartered Financials 705 1.4
Lloyds Banking Group Financials 662 1.4
Direct Line Insurance
Group Financials 659 1.3
BAE Systems Industrials 655 1.3
Keller Group Industrials 610 1.2
International Consolidated
Airlines Group Consumer Services 592 1.2
Greencore Group Consumer Goods 554 1.1
Nokian Renkaat Consumer Goods 530 1.1
Sage Group Technology 516 1.1
Next Consumer Services 493 1.0
KCOM Group Telecommunications 474 1.0
Novartis Health Care 461 0.9
CYBG Financials 452 0.9
Barclays Financials 416 0.9
IMI Industrials 411 0.8
Halfords Group Consumer Services 321 0.7
Softcat Technology 309 0.6
Midwich Group Technology 303 0.6
N Brown Group Consumer Services 290 0.6
Tullett Prebon Financials 200 0.4
Thomas Cook Group Consumer Services 188 0.4
Melrose Industries Industrials 62 0.1
--------------------------- --------------------- ------- ------------
Total Investments 49,307 100.0
-------------------------------------------------- ------- ------------
Cross Holdings in other Investment Companies
It is the Company's stated policy that this exposure should not
be permitted to exceed 15 per cent. of total assets. As at 30 June
2016, none of the Company's assets were invested in listed
closed-ended investment funds.
Interim Management Report
Related Party Transactions
During the first six months of the current financial year no
transactions with related parties have taken place which have
materially affected the financial position or performance of the
Company during the period.
Principal Risks and Uncertainties
The principal risks and uncertainties associated with the
Company's business can be divided into the following areas:
-- investment policy and process
-- market movements
-- legal and regulatory compliance
-- gearing
-- operational, and
-- financial, such as market price risk, interest rate risk, liability risk and credit risk.
Information on these risks is set out in the 2015 Annual Report
& Accounts.
In the view of the Board these principal risks and uncertainties
are applicable to the remaining six months of the financial year as
they were to the six months under review.
Going Concern
The Half-Yearly Financial Report has been prepared on a going
concern basis. The Directors consider that this is the appropriate
basis as they have a reasonable expectation that the Company has
adequate resources to continue in operational existence for the
foreseeable future. In considering this, the Directors took into
account the Company's investment objective, risk management
policies and capital management policies, the diversified portfolio
of readily realisable securities which can be used to meet
short-term funding commitments and the ability of the Company to
meet all of its liabilities and ongoing expenses. Thus the
Directors continue to adopt the going concern basis of accounting
in preparing the financial statements.
Directors' Responsibility Statement
The Board of Directors of Jupiter Dividend & Growth Trust
PLC, confirms that, to the best of its knowledge:
(a) The condensed set of financial statements have been prepared
in accordance with the Financial Reporting Council's statement
'Interim Financial Reporting' and give a true and fair view of the
assets, liabilities, financial position and profit of the Company
for the period ended 30 June 2016;
(b) The Chairman's Statement, the Investment Adviser's Review
and the Interim Management Report include a fair review of the
information required by Disclosure and Transparency Rule 4.2.7R;
and
(c) The Interim Management Report includes a fair review of the
information required by Disclosure and Transparency Rule 4.2.8R on
related party transactions.
The Half-Yearly Financial Report has not been audited or
reviewed by the Company's auditors.
For and on behalf of the Board
Martin Boase
Chairman
29 September 2016
Income Statement
For the six months to 30 June 2016 (unaudited)
Six months to 30.06.16 Six months to 30.06.15
-------------------- ----------------------------- --------------------------
Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------- ---------- -------- ------- -------- ------- -------
(Losses)/gains
from investments
held at fair
value through
profit
or loss (Note
3) - (3,130) (3,130) - 1,964 1,964
-------------------- ---------- -------- ------- -------- ------- -------
Net foreign
currency gains - 2 2 - 4 4
-------------------- ---------- -------- ------- -------- ------- -------
Income 1,268 - 1,268 1,359 - 1,359
==================== ========== ======== ======= ======== ======= =======
Gross return/(loss) 1,268 (3,128) (1,860) 1,359 1,968 3,327
-------------------- ---------- -------- ------- -------- ------- -------
Investment
management
fee (194) - (194) (200) - (200)
-------------------- ---------- -------- ------- -------- ------- -------
Other expenses (201) (1) (202) (147) - (147)
==================== ========== ======== ======= ======== ======= =======
Net return/(loss)
on ordinary activities
before finance
costs and
taxation 873 (3,129) (2,256) 1,012 1,968 2,980
-------------------- ---------- -------- ------- -------- ------- -------
Finance costs (171) 2,927 2,756 (198) (1,690) (1,888)
==================== ========== ======== ======= ======== ======= =======
Net return/(loss)
on ordinary
activities
before taxation 702 (202) 500 814 278 1,092
-------------------- ---------- -------- ------- -------- ------- -------
Tax on ordinary
activities (4) - (4) (30) - (30)
-------------------- ---------- -------- ------- -------- ------- -------
Net return/(loss)
on ordinary
activities
after taxation 698 (202) 496 784 278 1,062
-------------------- ---------- -------- ------- -------- ------- -------
Net return/(loss)
per Ordinary
Income share
(Note 4) 0.76p (0.22)p 0.54p 0.85p 0.30p 1.15p
-------------------- ---------- -------- ------- -------- ------- -------
Net return/(loss)
per Common
share
(Note 4) 2.12p (7.29)p (5.17)p 2.46p 4.21p 6.67p
-------------------- ---------- -------- ------- -------- ------- -------
The total column of this statement is the profit and loss
account of the Company prepared in accordance with UK Generally
Accepted Accounting Practice ('UK GAAP').
All revenue and capital items in the above statement derive from
continuing operations.
No operations were acquired or discontinued in the period.
The financial information does not constitute 'accounts' as
defined in section 434 of the Companies Act 2006.
Statement of Financial Position
As at 30 June 2016
30.06.16 31.12.15
(unaudited) (audited)
GBP'000 GBP'000
------------------------------ ----------- ---------
Fixed assets
------------------------------ ----------- ---------
Investments at fair value
through profit or loss 49,307 53,170
============================== =========== =========
Total Portfolio 49,307 53,170
------------------------------ ----------- ---------
Current assets
------------------------------ ----------- ---------
Debtors 542 149
------------------------------ ----------- ---------
Cash and cash equivalents 2,352 1,138
============================== =========== =========
2,894 1,287
------------------------------ ----------- ---------
Creditors: amounts falling
due within one year (1,317) (500)
============================== =========== =========
Net current assets 1,577 787
------------------------------ ----------- ---------
Total assets less current
liabilities 50,884 53,957
------------------------------ ----------- ---------
Creditors: amounts falling
due after more than one year
------------------------------ ----------- ---------
Zero Dividend Preference
shares and Common shares (49,991) (52,918)
------------------------------ ----------- ---------
Total net assets 893 1,039
------------------------------ ----------- ---------
Capital and reserves
------------------------------ ----------- ---------
Share capital 8,235 8,235
------------------------------ ----------- ---------
Share premium 21,864 21,864
------------------------------ ----------- ---------
Special reserve 62,062 62,062
------------------------------ ----------- ---------
Capital reserve* (92,161) (91,959)
------------------------------ ----------- ---------
Revenue reserve** 893 837
------------------------------ ----------- ---------
Total shareholders' funds 893 1,039
------------------------------ ----------- ---------
Net Asset Value per Ordinary
Income share (Note 7) 0.97p 1.13p
------------------------------ ----------- ---------
* These reserves are subject to restrictions in terms of their
distributability. Details of the restrictions are as follows:
Distributions would only be made to holders of Common shares from
the revenue reserve included in the capital reserve figure.
**These reserves form the distributable reserves of the Company
and may be used to fund distribution of profits to investors via
dividend payments.
Statement of Changes in Equity
For the six months to 30 June 2016 (unaudited)
Share Share Special Capital Revenue
For the six months Capital Premium Reserve Reserve Reserve Total
to 30 June 2016 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------- ------- ------- ------- -------- ------- -------
Balance at 1 January
2016 8,235 21,864 62,062 (91,959) 837 1,039
--------------------- ------- ------- ------- -------- ------- -------
Net return/(loss)
for the period - - - (202) 698 496
--------------------- ------- ------- ------- -------- ------- -------
Equity dividends
paid and declared* - - - - (642) (642)
--------------------- ------- ------- ------- -------- ------- -------
Balance at 30 June
2016 8,235 21,864 62,062 (92,161) 893 893
--------------------- ------- ------- ------- -------- ------- -------
For the six months to 30 June 2015 (unaudited)
For the six months Capital Premium Reserve Reserve Reserve Total
to 30 June 2015 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------- ------- ------- ------- -------- ------- -------
Balance at 1 January
2015 8,235 21,864 62,062 (91,572) 424 1,013
--------------------- ------- ------- ------- -------- ------- -------
Net return for the
period - - - 278 784 1,062
--------------------- ------- ------- ------- -------- ------- -------
Equity dividends
paid and declared - - - - (348) (348)
--------------------- ------- ------- ------- -------- ------- -------
Balance at 30 June
2015 8,235 21,864 62,062 (91,294) 860 1,727
--------------------- ------- ------- ------- -------- ------- -------
* For the dividends paid and declared:
Fourth quarterly dividend of 0.25p (2015: 0.18p) has been paid
out of revenue profits.
First quarterly dividend of 0.45p (2015: 0.20p) has been paid
out of revenue profits.
Statement of Cash Flow
For the six months to 30 June 2016 (unaudited)
Six months Six months
to to
30.06.16 30.06.15
GBP'000 GBP'000
-------------------------------- ---------- ----------
Net cash outflow from operating
activities (407) (895)
-------------------------------- ---------- ----------
Dividends received 1,153 1,756
-------------------------------- ---------- ----------
Taxation (4) (30)
================================ ========== ==========
Cash flows from investing
activities 742 831
-------------------------------- ---------- ----------
Purchase of investments (5,861) (8,766)
-------------------------------- ---------- ----------
Sale of investments 7,133 7,133
================================ ========== ==========
Other capital charges (1) -
================================ ========== ==========
Net cash inflow/(outflow)
from investing activities 1,271 (1,633)
-------------------------------- ---------- ----------
Cash flows from financing
activities
-------------------------------- ---------- ----------
Equity dividends paid (642) (348)
-------------------------------- ---------- ----------
Finance costs (dividends)
on Common shares (157) (85)
================================ ========== ==========
Net cash outflow from financial
activities (799) (433)
-------------------------------- ---------- ----------
Increase/(decrease) in
cash 1,214 (1,235)
-------------------------------- ---------- ----------
Cash and cash equivalents
at the start of the period 1,138 1,757
-------------------------------- ---------- ----------
Cash and cash equivalents
at the end of the period 2,352 522
================================ ========== ==========
1,214 (1,235)
-------------------------------- ---------- ----------
Cash and cash equivalents
consist of:
-------------------------------- ---------- ----------
Cash at bank and in hand 2,352 522
-------------------------------- ---------- ----------
2,352 522
-------------------------------- ---------- ----------
Notes to the Financial Statements
1. Financial Statements
The information contained within the financial statements in
this half year report has not been audited or reviewed by the
Company's auditors.
The figures and financial information for the year ended 31
December 2015 are extracted from the latest published financial
statements of the Company and do not constitute statutory accounts
for that year. Those financial statements have been delivered to
the Registrar of Companies and includes the report of the auditors
which was unqualified and did not contain a statement under either
section 498(2) or 498(3) of the Companies Act 2006.
2. Accounting Policies
The financial statements are prepared in accordance with the
Companies Act 2006, United Kingdom Generally Accepted Accounting
Practice ('UK GAAP'), including FRS 102 'The Financial Reporting
Standard applicable in the UK and Republic of Ireland' and the
Statement of Recommended Practice 'Financial Statements of
Investment Trust Companies and Venture Capital Trusts' (the 'SORP')
issued by the Association of Investment Companies in November
2014.
FRS 104, 'Interim Financial Reporting', issued by the Financial
Reporting Council ('FRC') in March 2015 has been applied in
preparing this condensed set of financial statements for the six
months ended 30 June 2016.
All of the Company's operations are of a continuing nature.
3. (Losses)/gains on investments
Six months
Six months to to
30.06.16 30.06.15
----------------------------------------- ----------
GBP'000 GBP'000
-------------------------------- ------- ----------
Net gains realised on sale
of investments 40 1,902
-------------------------------- ------- ----------
Movement in investment holdings
(losses)/gains (3,170) 62
-------------------------------- ------- ----------
(Losses)/gains on investments (3,130) 1,964
-------------------------------- ------- ----------
4. Return per share
Return per Ordinary Income shares
Six months
Six months to to
30.06.16 30.06.15
GBP'000 GBP'000
---------------------------------------------- ------------------------ ----------
Net revenue return applicable
to Ordinary
Income shares 698 784
---------------------------------------------- ------------------------ ----------
Net capital return applicable
to Ordinary
Income shares (202) 278
============================================== ======================== ==========
Net total return 496 1,062
---------------------------------------------- ------------------------ ----------
Number of Ordinary Income
shares in issue
during the period 91,675,333 91,675,333
---------------------------------------------- ------------------------ ----------
Net revenue return per Ordinary
Income share 0.76p 0.85p
---------------------------------------------- ------------------------ ----------
Net capital loss per Ordinary
Income share (0.22)p 0.30p
============================================== ======================== ==========
Net return per Ordinary
Income share 0.54p 1.15p
---------------------------------------------- ------------------------ ----------
Revenue return per Common
share
---------------------------------------------- ------------------------ ----------
Number of Common shares
in issue during the period 8,054,045 8,054,045
---------------------------------------------- ------------------------ ----------
Net revenue return applicable
to Common shares 2.12p 2.46p
---------------------------------------------- ------------------------ ----------
Net capital return applicable
to Common shares (7.29)p 4.21p
============================================== ======================== ==========
Net return per Common share (5.17)p 6.67p
---------------------------------------------- ------------------------ ----------
Return per Zero Dividend
Preference shares
---------------------------------------------- ------------------------ ----------
Number of Zero Dividend
Preference shares in issue
during the period 32,119,031 32,119,031
---------------------------------------------- ------------------------ ----------
Capital growth entitlement
applicable to Zero Dividend
Preference shares (2,340) 1,262
---------------------------------------------- ------------------------ ----------
Net return per Zero Dividend
Preference shares (7.29)p 3.93p
---------------------------------------------- ------------------------ ----------
5. Transaction Costs
During the period expenses were incurred in acquiring or
disposing of investments classified as fair value.
Six months
Six months to
to 30.06.16 30.06.15
---------- ------------ ----------
GBP'000 GBP'000
---------- ------------ ----------
Purchases 31 38
---------- ------------ ----------
Sales 6 7
---------- ------------ ----------
Total 37 45
---------- ------------ ----------
6. Comparative Information
The financial information contained in this interim report does
not constitute statutory accounts as defined in section 434 of the
Companies Act 2006. The financial information for the six months to
30 June 2016 and 30 June 2015 has not been audited.
The information for the year ended 31 December 2015 has been
extracted from the latest published audited financial statements.
The audited financial statements for the year ended 31 December
2015 have been filed with the Registrar of Companies. The report of
the auditors on those accounts contained no qualification or
statement under section 498(2) or (3) of the Companies Act
2006.
7. Net Asset Value per Ordinary Income share
The Net Asset Value per Ordinary Income share as at 30 June
2016, calculated in accordance with the Articles of Association,
was as follows:
30.06.16 31.12.15
------------------------- ------------ ------------ ------------ ------------
Net Net
Asset Value Asset Value
per share Asset Value per share Asset Value
attributable attributable attributable attributable
(p) GBP'000 (p) GBP'000
------------------------- ------------ ------------ ------------ ------------
Ordinary Income
shares 0.97 893 1.13 1,039
========================= ============ ============ ============ ============
Common shares 127.32 10,254 134.45 10,828
========================= ============ ============ ============ ============
Zero Dividend Preference
shares 124.44 39,969 131.73 42,309
========================= ============ ============ ============ ============
Net Asset Value per Ordinary Income shares on the balance sheet
is based on net assets of GBP893,000 (31 December 2015:
GBP1,039,000) and on 91,675,333 (31 December 2015: 91,675,333)
Ordinary Income shares, being the number of Ordinary Income shares
in issue at the end of the period.
8. Fair valuation of investments
The fair value hierarchy analysis for investments held at fair
value at the period end is as follows:
30.06.16
--------------------------- ------- ------- ------- --------
Level Level Level
1 2 3 Total
GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- ------- ------- ------- --------
Quoted prices for
identical instruments
in active markets 49,307 - - 49,307
=========================== ======= ======= ======= ========
Total value of investments 49,307 - - 49,307
--------------------------- ------- ------- ------- --------
31.12.15
--------------------------- ------- ------- ------- --------
Level Level Level
1 2 3 Total
GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- ------- ------- ------- --------
Quoted prices for
identical instruments
in active markets 53,170 - - 53,170
=========================== ======= ======= ======= ========
Total value of investments 53,170 - - 53,170
--------------------------- ------- ------- ------- --------
9. Transactions with the Manager
Jupiter Unit Trust Managers Limited ('JUTM') is contracted to
provide investment management services to the Company (subject to
termination by not less than twelve months' notice by either party)
for an annual fee of 0.75 per cent. of total assets less current
liabilities payable quarterly in arrears.
The Management fee paid to JUTM for the period 1 January 2016 to
30 June 2016 was GBP194,000. Management fees of GBP96,000 were
outstanding as at 30 June 2016 (30 June 2015: GBP100,000).
JUTM is also entitled to receive a performance fee of 15 per
cent. of the amount by which audited total assets less current
liabilities on the last day of each accounting period exceed the
higher of (a) 110 per cent. of the total assets less current
liabilities at the end of the immediately preceding accounting
period and (b) the total assets less current liabilities at the end
of the last accounting period for which a performance fee was paid
('the high water mark'). In the event of, inter alia, a reduction
of capital or bonus issue the calculation of the performance fee
shall be adjusted in such a manner as the Company's auditors shall
determine is appropriate to take account of such events.
A copy of the Half-Yearly Financial Report has been submitted to
the National Storage Mechanism and will shortly be available for
inspection at www.morningstar.co.uk/uk/NSM
The Half-Yearly Financial Report will also shortly be available
for download from the Company's website
(www.jupiteram.com/JDT).
For further information, please contact:
Richard Pavry
Head of Investment Trusts
Jupiter Asset Management Limited, Company Secretary
investmentcompanies@jupiteram.com
020 3817 1496
29 September 2016
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR BXGDCGSDBGLC
(END) Dow Jones Newswires
September 29, 2016 09:43 ET (13:43 GMT)
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