TIDMOIG
RNS Number : 8291S
Oryx International Growth Fund Ld
25 November 2011
FOR IMMEDIATE RELEASE
RELEASED BY BNP PARIBAS FUND SERVICES (GUERNSEY) LIMITED
HALF YEARLY RESULTS ANNOUNCEMENT
THE BOARD OF DIRECTORS OF ORYX INTERNATIONAL GROWTH FUND LIMITED
ANNOUNCE UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER
2011
Corporate Summary
INVESTMENT OBJECTIVE
The investment objective of Oryx International Growth Fund
Limited (the "Company") is to seek to generate consistently high
absolute returns whilst maintaining a low level of risk for
Shareholders.
The Company principally invests in small and mid-size quoted and
unquoted companies in the United Kingdom and United States. The
Investment Manager targets companies that have fundamentally strong
business models, but where there may be specific factors which are
constraining the maximisation or realisation of shareholder value,
which may be realised through the pursuit of an activist
shareholder agenda by the Investment Manager. Dividend income is a
secondary consideration when making investment decisions.
STRUCTURE
The Company is an authorised closed-ended investment company
incorporated in Guernsey on 2 December 1994. The Company's shares
have been admitted to the Official List and to trading on the main
market of the London Stock Exchange. The issued capital during the
period comprises the Company's Ordinary Shares.
INVESTMENT MANAGER AND INVESTMENT ADVISER
The Investment manager and the Investment adviser during the
period was Harwood Capital LLP (formerly named North Atlantic Value
LLP), a United Kingdom limited liability partnership incorporated
under the Limited Partnerships Act 2000 (partnership number
OC304213) and regulated by the Financial Services Authority.
DIRECTORS
NIGEL CAYZER (Chairman) CHRISTOPHER MILLS
British British
Nigel Cayzer is Chairman of Aberdeen Christopher Mills is Chief Investment
Asian Smaller Companies Investment Officer of North Atlantic Smaller
Trust PLC. He is also a director Companies Investment Trust plc,
of a number of private companies. "NASCIT". NASCIT is winner of numerous
He was Chairman of the Oriel Group Micropal and S&P Investment Trust
PLC from 1989 until 1998, a non-executive awards.
director of Caledonia Investments
PLC from 1986 until 2002, the Alliance
Housing Bank SAOG from 1998 until
2006 and Chairman of the Oryx Fund
Ltd from 1994 until 2004.
SIDNEY CABESSA JOHN RADZIWILL
French British
Sidney Cabessa is Chairman of CIC John Radziwill is currently a director
Finance an Investment Fund and of International Assets Holding
a subsidiary of French banking Corp, Goldcrown Group Limited,
group, CIC - Credit Mutuel. Mr Fourth Street Capital, Ltd (BVI),
Cabessa is a director of Nature Fifth Street Capital,Ltd (BVI),
et Decouvertes, International Metal PingTone Communications, Inc. and
Service, Nord Est, Club-Sagem, Vendor Safe Technologies LLC.
CIC Securities, CIC Capital Prive,
Medias-Participation and HRA Pharma. In the past five years, he has
also served as a director of Baltimore
Capital Plc, USA Micro Cap Value
Co. Ltd, Acquisitor Plc, Acquisitor
Holdings (Bermuda) Ltd and Lionheart
Group Inc. Mr Radziwill is a member
of the Bar of England and Wales.
WALID CHATILA JOHN GRACE
Canadian New Zealander
Walid Chatila is a Certified Public Mr Grace is a Director and Founder
Accountant (Texas 1984) and a Chartered of Sterling Grace International
Accountant (Ontario 1991). He is Ltd. Mr Grace is also Chairman
currently the General Manager of of Trustees Executors Holdings
Al Nowais Investments LLC In Abu Ltd, the premier and oldest New
Dhabi, United Arab Emirates. From Zealand trust company established
1994 to 2006 he was the Finance in 1882. Mr Grace graduated from
Director of Emirates Holdings in Georgetown University. Mr Grace
Abu Dhabi and prior to that he has served as a director of numerous
worked in audit and has more than public companies and charities.
11 years of international audit
and special assignment experience John Grace was appointed as a director
in the Middle East and North America. on 8(th) March 2011.
RUPERT EVANS
British
Rupert Evans is a Guernsey Advocate
and was a partner in the firm of
Ozannes between 1982 and 2003,
since then he has been a consultant
to Ozannes (now Mourant Ozannes).
He is a non-executive director
of a number of other investment
companies some of which are quoted
on recognised stock exchanges.
He is a Guernsey resident.
CHAIRMAN'S STATEMENT
As the investment manager has reported, market conditions have
been very volatile during the first six months of our financial
year. Against this background it is comforting to report that net
asset value per share fell only 1.1% in the period to 30(th)
September 2011. This compares to a fall in the FT small cap indice
of approximately 12.9%.
The investment philosophy of Harwood Capital LLP is based on the
identification of potential value in underperforming companies and
then realising that value through positive action.
The period under review reflects a fairly quiet period, but
opportunities continue to be sought in relation to new investments
and work continues on realising value in the existing
portfolio.
In line with our stated policy, no dividend will be paid for the
period.
Nigel Cayzer
Chairman
25 November 2011
INVESTMENT ADVISER'S REPORT
The period under review saw extremely turbulent market
conditions with the FTSE falling by 13.2% and the FTSE Small Cap by
12.9%. Against this background it is encouraging to report that the
Company limited the decline in net asset value per share to
1.1%.
Quoted Portfolio:
A number of stocks outperformed the general market and, in
particular, CVS rose 7%; RPC nearly 20%; IDOX over 20% and Prime
Focus which was sold for nearly a 100% uplift.
Against this GTL fell 15%; GPG Group 20%; Quarto 10% and BBA
14%. The only major new holding during the period was Redhall, a
small specialist engineering group.
Unquoted Portfolio:
Overall the private equity portfolio was unchanged during the
six months under review. This reflects a modest write down in
Indicant and a modest write up in Celsis. Taken as a whole, the
portfolio continues to perform well and it is possible that there
will be a number of realisations above the current valuation.
Outlook:
Although the broad market has recovered since the end of
September, the FTSE Small Cap has only enjoyed a very modest
recovery which has inevitably impacted the Company. However, it is
pleasing to note that at the end of October the Net Asset Value has
risen since the end of March and continues to substantially
out-perform the Small Cap Index.
Notwithstanding this, it is our view that the market as a whole
will remain very volatile for the foreseeable future; the financial
problems facing Europe remain unresolved. However, a number of the
Company's listed investments are well positioned for corporate
activity and there remains in our opinion scope for capital
appreciation in the unquoted portfolio. Taken as a whole, we are
hopeful that the current year will see a further modest increase in
the net asset value of the Company.
Harwood Capital LLP
25 November 2011
TEN LARGEST EQUITY HOLDINGS
as at 30 September 2011
CVS Group Plc
Cost GBP3,635,969 (3,750,000 shares)
Market value GBP3,698,438 representing 6.83% of Net Asset
Value
The company owns the largest chain of veterinary practice in the
United Kingdom with a market share of circa 10%. The shares were
acquired on a price earning ratio of 7x. Recent results have been
in line with market expectations and the shares have performed
well.
Gleeson (M.J.) Group Plc
Cost GBP7,118,533 (3,500,000 shares)
Market value GBP3,631,250 representing 6.70% of Net Asset
Value
Gleeson is a small builder with operations in the Midlands and
North of England. The company has no debt and was modestly
profitable for the six months ended June 2011. The shares trade at
a discount to tangible book of about 40%.
RPC Group Plc
Cost GBP1,939,267 (1,000,000 shares)
Market value GBP3,369,000 representing 6.22% of Net Asset
Value
RPC is the largest company plastic packaging company in Europe.
A new chairman has restructured the business and made a good
acquisition and this will lead to a significant improvement in
profitability over the next few years. Recent results have been
most encouraging and the shares have performed well.
Redhall Group Plc
Cost GBP2,847,795 (4,600,000 shares)
Market value GBP2,955,500 representing 5.46% of Net Asset
Value
The company is a specialist engineer with a strong market
presence in nuclear decommissioning. The shares were purchased on
less than 4 x EV/EBITDA reflecting a substantial de-rating as a
result of a contract where it is alleged the company under
performed. The company has repudiated the clients allegations and
so far has been successful.
BBA Aviation Plc
Cost GBP3,950,503 (1,750,000 shares)
Market value GBP2,929,500 representing 5.41% of Net Asset
Value
BBA Aviation's principal business is Signature which is the
leading provider of aviation support facilities for private jets
throughout the world. The company has modest debt and is seeing
good growth in the US in particular as business travel in private
jets returns to historic level. Although profits have met
expectations the share price performance in recent months has been
disappointing.
Guinness Peat Group Plc
Cost GBP3,694,546 (10,000,000 shares)
Market value GBP2,894,958 representing 5.34% of Net Asset
Value
The company is an industrial conglomerate with its principal
subsidiary being Coats - the world's largest manufacturer of
thread. The company is in the process of breaking itself up which
we expect will lead to a substantial profit for this holding.
Orthoproducts Limited
Cost GBP1,206,964 (319,000 shares)
Market value GBP2,791,250 representing 5.15% of Net Asset
Value
Orthoplastics is one of two companies in the world capable of
manufacturing advanced plastic materials to the orthopaedics
industry. In addition the company is successful in rapidly growing
plastic components for the same industry. Recent results have been
very good and the outlook of the business looks encouraging.
Augean Plc
Cost GBP5,560,331 (11,000,000 shares)
Market value GBP2,777,500 representing 5.13% of Net Asset
Value
Augean owns 60% of the hazard based landfill capacity in the
United Kingdom. Recent results have reflected a weakness in the
construction industry. The company has recently secured planning
permission to dispose of low level nuclear waste in the United
Kingdom.
GTL Resources Plc
Cost GBP2,514,357 (3,400,000 shares)
Market value GBP2,575,500 representing 4.75% of Net Asset
Value
The company owns a 115 million gallon per annum ethanol facility
in Rochelle Illinois. Although the business is principally a
commodity business, there are reasons to believe that over the long
term supply and demand will be broadly in balance and that margins
will widen. Since the end of the period, Oryx International Growth
Fund Limited is a participant in an offer which has resulted in a
40% increase in value from the 30(th) September.
Quarto Group Inc
Cost GBP2,332,014 (1,935,000 shares)
Market value GBP2,534,850 representing 4.68% of Net Asset
Value
The company is the world's largest publisher of 'coffee table'
books, and a significant publisher of 'How to' books. Both these
segments appear to be more resilient than traditional publishing.
The shares currently trade on a modest price earnings of multiple
of around 5x.
DIRECTORS' RESPONSIBILITY STATEMENT
The Directors confirm to the best of their knowledge that:
-- The half-yearly accounts, which have been prepared in
accordance with International Financial Reporting Standards, give a
true and fair view of the assets, liabilities, financial position
and profit or loss of the Company and the undertakings included in
the consolidation taken as a whole as required by DTR 4.2.4R;
-- The Interim Management Report and Investment Adviser's Report
include a fair review of the information required by DTR 4.2.7R
(indication of important events during the first six months and
description of principal risks and uncertainties for the remaining
six months of the year); and
-- The Interim Management Report includes a fair review of the
information required by DTR 4.2.8R (disclosure of related party
transactions and changes therein).
By order of the Board
Walid Chatila John Radziwill
Director Director
25 November 2011 25 November 2011
INTERIM MANAGEMENT REPORT
Business review
A review of the Company's activities is given in the Corporate
Summary on page 2, the Chairman's statement on page 4 and the
Investment Adviser's report on page 5.
Dividend Policy
To the extent that any dividends are paid they will be paid in
accordance with any applicable laws and regulations of the UK
Listing Authority and the requirements of the Companies (Guernsey)
Law, 2008, as amended. The Directors do not propose payment of a
dividend (30 September 2010 - Nil, 31 March 2011- Nil).
Capital Values
At 30 September 2011 the value of net assets available to
Shareholders was GBP54,175,634 (30 September 2010 - GBP50,905,571,
31 March 2011 - GBP55,881,895) and the Net Asset Value per share
was GBP2.69 (30 September 2010 - GBP2.47, 31 March 2011 -
GBP2.72).
Related party transactions
Related party transactions are disclosed in note 8 to the
condensed financial statements.
Risks and uncertainties
The main risks arising from the Group's financial instruments
are:
(i) market risk, including currency risk, interest rate risk and other price risk;
(ii) liquidity risk; and
(iii) credit risk
The Company Secretary, in close cooperation with the Board of
Directors and the Investment Manager, coordinates the Group's risk
management. The policies for managing each of these risks are
summarised below and have been applied throughout the period.
(i) Market risk
The fair value or future cash flows of a financial instrument
held by the Group 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 year
ended 31 March 2011. The Investment Manager assesses the exposure
to market risk when making each investment decision and monitors
the overall level of market risk on the whole of the investment
portfolio on an ongoing basis.
Currency risk
The functional and presentational currency of the Group is
Sterling and, therefore, the Group's principal exposure to foreign
currency risk comprises investments priced in other currencies,
principally US Dollars. The Investment Manager monitors the Group's
exposure to foreign currencies and reports to the board on a
regular basis. The Investment Manager measures the risk to the
Group of the foreign currency exposure by considering the effect on
the net asset value and income of a movement in the rates of
exchange to which the Group's assets, liabilities, income and
expenses are exposed.
Income denominated in foreign currencies is converted to
Sterling on receipt.
The Group's financial assets comprise fixed and equity
investments, trade receivables and cash balances.
The Group finances its investment activities through the Group's
Ordinary Share capital and reserves. The Group's financial
liabilities comprise trade payables.
Interest rate risk
Interest rate movements may affect:
-- the fair value of the investments in fixed rate securities; and
-- 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 unquoted loans to companies in
which private equity investment is made. Interest rate risk is not
significant to the Group.
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 investments.
The Group's exposure to price risk comprises mainly movements in
the value of the Group's investments.
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 Investment Manager. The
Board meets regularly and at each meeting reviews investment
performance. The Board monitors the Investment Manager's compliance
with the Group's objectives and is directly responsible for
investment strategy and asset allocation.
(ii) Liquidity risk
This is the risk that the Group will encounter difficulty in
meeting obligations associated with financial liabilities.
Liquidity risk is significant as the Group invests in unlisted
equities and other investments that may not be readily
realisable.
In accordance with the Group's policy, the Investment Manager
monitors the Company's liquidity risk, and the Board of Directors
reviews it.
(iii) Credit risk
The Group 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
Group's cash flows, should a default happen.
BY ORDER OF THE BOARD
Walid Chatila, Director John Radziwill, Director
25 November 2011 25 November 2011
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the six month period ended 30 September 2011, expressed in
GBP sterling
Six months Six months Year ended
ended 30 ended 30 31 March
Sept 2011 Sept 2010 2011
Notes GBP GBP GBP
Income
Interest - 342,138 311,423
Dividends 673,789 818,900 879,884
Other Income 79,220 32,155 48,886
------------- ------------ ------------
753,009 1,193,193 1,240,193
Realised gains/losses on investments 2(g) 1,052,942 (2,339,640) (3,369,053)
Unrealised (loss)/gain on revaluation of investments 2(g) (1,967,934) 6,075,383 12,904,723
Gain on foreign currency translation 2(f) 16,936 626 129,818
(Loss)/gain from investments (898,056) 4,929,562 10,905,681
------------- ------------ ------------
Expenses
Management and investment adviser's fees 2(j) 308,899 273,578 577,525
Performance fees - - 100,000
Directors' fees and expenses 2(j) 83,891 93,736 130,451
Administration fees 29,559 26,579 55,120
Audit fees 23,759 24,082 31,260
Printing fees 15,563 - -
Transaction costs 14,861 31,468 164,589
Legal and professional fees 64,218 120,942 218,226
Regulatory fees 7,918 - -
Custodian fees 7,275 7,335 17,317
Insurance fees 5,236 4,401 9,637
Registrar and transfer agent fees 2,841 5,422 14,973
Other expenses 29,506 12,783 142,562
Total expenses 593,526 600,326 1,461,660
------------- ------------ ------------
Net (loss)/income for the period/year before taxation (738,573) 4,329,236 9,444,021
Withholding tax on dividends (1,688) 122,492 111,532
Net (loss)/income for the period/year (740,261) 4,206,744 9,332,489
------------- ------------ ------------
(Loss)/Income per share - basic and diluted:
Ordinary 7 GBP(0.04) GBP0.20 GBP0.44
------------- ------------ ------------
All items in the above statement are derived from continuing
operations.
The accompanying notes on pages 15 to 21 form an integral part
of these condensed financial statements.
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
as at 30 September 2011, expressed in GBP sterling
30 September 30 September 31
March
2011 2010 2011
Notes GBP GBP GBP
Non-current assets
Listed investments designated at fair value through profit or
loss (Cost - GBP58,922,871) 45,059,918 32,983,981 44,948,567
Unlisted investments designated at fair value through profit or
loss (Cost - GBP5,800,928) 8,375,974 8,742,222 9,518,017
53,435,892 41,726,203 54,466,584
------------- ------------- ------------
Current assets
Amounts due from brokers 668,973 22,455 1,024,781
Dividends and interest receivable 460,487 171,225 24
Other receivables and prepayments 2(c) 8,806 80,748 75,185
Cash and cash equivalents 2(d) - 9,343,390 880,745
1,138,266 9,617,818 1,980,735
------------- ------------- ------------
Total assets 54,574,158 51,344,021 56,447,319
------------- ------------- ------------
Current liabilities
Other payables and accrued expenses 2(e) 284,568 372,010 565,424
Overdraft 61,590 - -
Amounts due to brokers 52,366 66,440 -
398,524 438,450 565,424
------------- ------------- ------------
Net assets 54,175,634 50,905,571 55,881,895
------------- ------------- ------------
Shareholders' equity
Called up share capital 3 10,070,385 10,314,310 10,280,385
Share premium 3 42,696,509 42,696,509 42,696,509
Capital redemption reserve 1,246,500 1,246,500 1,246,500
Other reserves 4 162,240 (3,351,748) 1,658,501
Total equity shareholders' funds 54,175,634 50,905,571 55,881,895
Net Asset Value per Share - basic and diluted 7 GBP2.69 GBP2.47 GBP2.72
------------- ------------- ------------
This interim report was approved by the Board of Directors on 25
November 2011 and signed on its behalf by:
Walid Chatila John Radziwill
Director Director
The accompanying notes on pages 15 to 21 form an integral part
of these condensed financial statements.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the six month period ended 30 September 2011 (comparative:
year ended 31 March 2011), expressed in
GBP sterling
Capital
redemption
Notes Share Capital Share Premium reserve Other reserves Total
GBP GBP GBP GBP GBP
Balance at 1 April
2011 10,280,385 42,696,509 1,246,500 1,658,501 55,881,895
-------------- -------------- ------------ --------------- -----------
Total Comprehensive
Loss
For the Period - - - (740,261) (740,261)
-------------- -------------- ------------ --------------- -----------
Transactions with
owners,
recorded directly
in equity
Contributions, redemptions
and distributions
to shareholders
- Cancellation of 3,
shares 4 (210,000) - - (756,000) (966,000)
Total transactions
with owners (210,000) - - (756,000) (966,000)
-------------- -------------- ------------ --------------- -----------
Balance at 30 September
2011 10,070,385 42,696,509 1,246,500 162,240 54,175,634
-------------- -------------- ------------ --------------- -----------
Capital
redemption
Notes Share Capital Share Premium reserve Other reserves Total
GBP GBP GBP GBP GBP
Balance at 1 April
2010 11,252,912 42,696,509 1,246,500 (5,157,918) 50,038,003
-------------- -------------- ------------ --------------- ------------
Total Comprehensive
Income - - -
For the Year 9,332,489 9,332,489
-------------- -------------- ------------ --------------- ------------
Transactions with
owners,
recorded directly
in equity
Contributions, redemptions
and distributions
to shareholders
- Cancellation of 3,
shares 4 (972,527) - - (2,516,070) (3,488,597)
Total transactions
with owners (972,527) - - (2,516,070) (3,488,597)
-------------- -------------- ------------ --------------- ------------
Balance at 31 March
2011 10,280,385 42,696,509 1,246,500 1,658,501 55,881,895
-------------- -------------- ------------ --------------- ------------
The accompanying notes on pages 15 to 21 form an integral part
of these condensed financial statements. CONDENSED CONSOLIDATED
STATEMENT OF CASH FLOWS
for the six month period ended 30 September 2011, expressed in
GBP sterling
Six months Six months Year
ended ended Ended
30 September 30 September 31
March
2011 2010 2011
Notes GBP GBP GBP
Net cash inflow from operating activities 5 6,729 13,603,292 5,160,876
------------- ------------- ------------
Financing Activities
Cancellation of shares (966,000) (3,339,176) (3,488,597)
Proceeds of borrowings - - 990,000
Repayment of borrowings - - (990,000)
Bank overdraft (repaid)/drawn down - (1,116,352) (1,116,352)
------------- ------------- ------------
Cash outflow from financing activities (966,000) (4,455,528) (4,604,949)
------------- ------------- ------------
Net (decrease)/increase in cash and cash equivalents (959,271) 9,147,764 555,927
Cash and cash equivalents at beginning of period/year 880,745 195,000 195,000
Effect of exchange rate fluctuations on cash and cash equivalents 16,936 626 129,818
Cash and cash equivalents at end of period/year (61,590) 9,343,390 880,745
------------- ------------- ------------
The accompanying notes on pages 15 to 21 form an integral part
of these condensed financial statements.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. General
Oryx International Growth Fund Limited (the "Company") was
incorporated in Guernsey on 2 December 1994 and commenced
activities on 3 March 1995. The Company was listed on the London
Stock Exchange on 3 March 1995.
The Company is a Guernsey Authorised Closed-Ended Investment
Scheme and is subject to the Authorised Closed-Ended Investment
Scheme Rules 2008.
The investment activities of the Company are managed by Harwood
Capital LLP, formerly named North Atlantic Value LLP, ('the
Investment Manager') and the administration of the Company is
delegated to BNP Paribas Fund Services (Guernsey) Limited ('the
Administrator').
The Half-yearly Report will be available to view and download at
the Company's website www.oryxinternationalgrowthfund.co.uk and
copies may also be obtained from the Company's registered office at
BNP Paribas House, 1 St Julian's Avenue, St Peter Port, Guernsey
GY1 1WA.
2. Accounting Policies
Basis of Preparation
The financial statements of the Company are prepared in
accordance with International Financial Reporting Standards
("IFRS") as adopted by the European Union and International
Accounting Standards and Standing Interpretations Committee
interpretations approved by the International Accounting Standards
Committee ("IASC") that remain in effect, together with applicable
legal and regulatory requirements of Guernsey Law. The condensed
set of financial statements included in this half-yearly financial
report are unaudited and have been prepared in accordance with
International Accounting Standard (IAS) 34, Interim Financial
Reporting. The same accounting policies, presentation and methods
of computation are followed in the condensed set of financial
statements as applied in the Company's latest annual audited
financial statements.
The financial statements have been prepared on the historical
cost basis except for the inclusion at fair value of certain
financial instruments. The principal accounting policies are set
out below. The preparation of financial statements in conformity
with International Financial Reporting Standards requires the
Company to make estimates and assumptions that affect the reported
amounts of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during
the reporting period. It also requires the Board of Directors to
exercise its judgement in the process of applying the Company's
accounting policies.
Adoption of new standards
The following new standards came into force for periods
commencing 1 April 2011.
IFRS 7 Financial Instruments: Disclosures (revised October 2010)
IAS 1 Presentation of Financial Instruments (revised May 2010)
IAS 24 Related Party Disclosures (revised November 2009)
IAS 34 Interim Financial Reporting (revised May 2010)
The adoption of these standards did not have a material impact
on the financial statements of the Company.
The Directors believe that other pronouncements which are in
issue but not yet operative or adopted by the Company will not have
a material impact on the financial statements of the Company.
Going Concern
The Directors believe it is appropriate to adopt the going
concern basis in preparing the financial statements as, after due
consideration, the Directors consider that the Group has adequate
resources to continue in operational existence for the foreseeable
future.
a) Income Recognition
Dividend income is recognised when the right to receive income
is established. Usually this is the ex-dividend date for equity
securities. Deposit interest is accrued on a day-to-day basis. Loan
interest is accounted for using the effective interest method. All
income is shown gross of any applicable withholding tax.
b) Investments
Classification
All investments of the Company, together with its subsidiaries
('the Group'), are designated into the financial assets at fair
value through profit or loss category. The investments are
purchased mainly for their capital growth and the portfolio is
managed, and performance evaluated, on a fair value basis in
accordance with the Group's documented investment strategy.
Therefore the Directors consider that this is the most appropriate
classification.
This category comprises financial instruments designated at fair
value though profit or loss upon initial recognition - these
include financial assets that are not held for trading purposes and
which may be sold. These are principally investments in listed and
unlisted equities.
Fair value measurement principles
Financial instruments are measured initially at fair value being
the transaction price. Subsequent to initial recognition on trade
date, all instruments classified as fair value through profit or
loss are measured at fair value with changes in their fair value
recognised in the Statement of Comprehensive Income. Transaction
costs are separately disclosed in the Statement of Comprehensive
Income.
Listed investments have been valued at the bid market price
ruling at the Statement of Financial Position date. In the absence
of the bid market price, the closing price has been taken, or, in
either case, if the market is closed on the Consolidated Statement
of Financial Position date, the bid market or closing price on the
preceding business day.
Fair Values of unlisted investments are derived in accordance
with the International Private Equity and Venture Capital
Association (IPEVCA) guidelines. Their valuation includes all
factors that market participants would consider in setting a price.
The primary valuation techniques employed to value the unlisted
investments are earnings multiples, recent transactions and the net
asset basis. Cost is considered appropriate for early stage
investments. The relevance of this methodology can be eroded over
time and in these cases the carrying values will be adjusted to
reflect fair value.
For certain of the Group's financial instruments, including cash
and cash equivalents, interest and dividends and interest
receivable and amounts due to and from broker, the carrying amounts
approximate fair value due to their immediate or short-term
maturity.
Derecognition of financial assets occur when the rights to
receive cash flows from financial instruments expire or are
transferred and substantially all of the risks and rewards of
ownership have been transferred.
Fair value measurement should be determined based on assumptions
that market participants would use in pricing an asset or
liability. As a basis for considering market participant
assumptions, IFRS 7 establishes a fair value hierarchy that gives
the highest priority to unadjusted quoted prices in active markets
(Level 1) and lowest priority to unobservable inputs (Level 3). The
three levels of the value hierarchy are as follows.
Level 1: Inputs that reflect unadjusted quoted prices in active
markets for identical assets or liabilities that the Company has
the ability to access at the measurement date;
Level 2: Inputs reflect quoted prices of similar assets and
liabilities in active markets and quoted prices of identical assets
and liabilities in markets that are considered to be inactive, as
well as inputs other than quoted prices that are observable for the
asset or liability either directly or indirectly; and
Level 3: Inputs that are unobservable for the asset or liability
and reflect the Investment Manager's own assumptions in accordance
with the accounting policies disclosed within note 2 to the
financial statements.
c) Other receivables
Other receivables do not carry any interest and are short term
in nature and are accordingly stated at their amortised cost as
reduced by appropriate allowances for impairment.
d) Cash and cash equivalents
Cash and cash equivalents consist of cash in hand and short term
deposits in banks with original maturities of less than three
months.
e) Other Payables and Accrued Expenses
Other payables and accrued expenses are not interest bearing and
are stated at their amortised cost.
f) Foreign Currency Translation
Items included in the Group's financial statements are measured
using the currency of the primary economic environment in which it
operates (the "functional currency"). This is the pound sterling
which reflects the Group's primary activity of investing in
sterling securities. The Group's shares are also issued in
sterling.
Foreign currency assets and liabilities have been translated at
the exchange rates ruling at the Consolidated Statement of
Financial Position date. Transactions in foreign currency during
the period have been translated into pounds sterling at the spot
exchange rate in effect at the date of the transaction. Realised
and unrealised gains and losses on currency translation are
recognised in the Consolidated Statement of Comprehensive
Income.
g) Realised and Unrealised Gains and Losses
Realised gains and losses arising on the disposal of investments
are calculated by reference to the cost attributable to those
investments and the sales proceeds, and are included in the
Consolidated Statement of Comprehensive Income. Unrealised gains
and losses arising on investments held at the Consolidated
Statement of Financial Position date are also included in the
Consolidated Statement of Comprehensive Income.
h) Financial Liabilities
All bank loans and borrowings are initially recognised at cost,
being the fair value of the consideration received, less issue
costs where applicable. After initial recognition, all interest
bearing loans and borrowings are subsequently measured at amortised
cost. Any difference between cost and redemption value has been
recognised in the Condensed Consolidated Statement of Comprehensive
Income over the period of the borrowings on an effective interest
basis.
Financial liabilities are derecognised from the Condensed
Consolidated Statement of Financial Position only when the
obligations are extinguished either through discharge, cancellation
or expiration.
i) Equity
Share Capital represents the nominal value of equity shares.
Share Premium represents the excess over nominal value of the
fair value of consideration received for equity shares, net of
expenses of the share issue. Share premium is debited for the
excess of redemption price over par value of shares.
Other Reserves and the Capital Redemption Reserve include all
current and prior results as disclosed in the Condensed
Consolidated Statement of Comprehensive Income. Other Reserves also
includes the deduction for the excess of consideration paid over
nominal value on share buy-backs.
j) Expenses
Expenses are recognised in the condensed consolidated Condensed
Consolidated Statement of Comprehensive Income upon utilisation of
the service or at the date they are incurred.
k) Consolidation
These condensed consolidated financial statements comprise the
condensed financial statements of the Company and its wholly owned
subsidiary undertaking, American Opportunity Trust PLC, which is UK
registered. Subsidiaries are those entities controlled by the
Company. Control exists when the Company has the power to govern
the financial and operating policies of an entity so as to obtain
benefits from its activities.
The financial statements of subsidiaries are included in the
condensed consolidated financial statements from the date that
control commences until the date that control ceases. The condensed
financial statements have been prepared using uniform accounting
policies for like transactions and other events in similar
circumstances. All intra-group balances and transactions are
eliminated in full in preparing the condensed consolidated
financial statements.
3. Share Capital and Share Premium
a) Authorised Share Capital
Number of GBP
Shares
Authorised:
Ordinary shares of
50p each 90,000,000 45,000,000
----------- -----------
b) Ordinary Shares Issued - 1 April 2011 to 30 September 2011
Ordinary Shares Number Share Capital Share Premium
of 50p each of Shares GBP GBP
At 1 April 2011 20,560,769 10,280,385 42,696,509
Cancellation of
shares (420,000) (210,000) -
----------- -------------- --------------
At 30 September
2011 20,140,769 10,070,385 42,696,509
----------- -------------- --------------
Ordinary Shares Issued - 1 April 2010 to 31 March 2011
Ordinary Shares Number Share Capital Share Premium
of 50p each of Shares GBP GBP
At 1 April 2010 22,505,823 11,252,912 42,696,509
Cancellation of
shares (1,945,054) (972,527) -
------------ -------------- --------------
At 31 March 2011 20,560,769 10,280,385 42,696,509
------------ -------------- --------------
During April 2011, the Company repurchased for cancellation
250,000 shares at an average price of 230p per share. A further
170,000 shares were repurchased for cancellation at an average
price of 230p per share in May 2011.
4. Other reserves
31 March Movement 30 September
2011 2011
GBP GBP GBP
Net investment income 1,999,433 157,795 2,157,228
Realised loss on investments 19,122,237 1,052,942 20,175,179
Loss on foreign currency
transactions (772,851) 16,936 (755,915)
Unrealised gain on revaluation
of investments held (9,319,971) (1,967,934) (11,287,905)
Repurchase of ordinary shares (8,041,457) (756,000) (8,797,457)
Repurchase of warrants (8,179) - (8,179)
Discount on repurchase of
Convertible Loan Stock (1,320,711) - (1,320,711)
------------- ------------- --------------
1,658,501 (1,496,261) 162,240
------------- ------------- --------------
5. Cash Flows from Operating Activities
Six months Six months Year
ended 30 ended 30 ended
September September 31 March
2011 2010 2011
GBP GBP GBP
Net (loss)/income for the period/year (740,261) 4,206,744 9,332,489
------------- ------------- --------------
Realised (gains)/losses on investments (1,052,942) 2,339,640 3,369,053
Movement in unrealised loss on
revaluation of investments 1,967,934 (6,075,383) (12,904,723)
Loss on foreign currency translation (16,936) (626) (129,818)
-------------
898,056 (3,736,369) (9,665,488)
------------- ------------- --------------
Purchase of investments (15,264,362) (4,553,845) (26,774,670)
Proceeds from sale of investments 15,380,063 17,747,923 31,959,528
-------------
115,701 13,194,078 5,184,858
------------- ------------- --------------
(Increase)/decrease in dividends
and interest receivable (104,655) 2,005 173,206
Decrease in other receivables 66,378 21,585 27,148
Decrease in other accruals and
payables (228,490) (84,751) 108,663
------------- ------------- --------------
(266,767) (61,161) 309,017
------------- ------------- --------------
6,729 13,603,292 5,160,876
------------- ------------- --------------
6. Reconciliation of Net Asset Value to Published Net Asset
Value
30 September 31 March
2011 GBP 2011 GBP per
Ordinary Shares GBP per GBP share
share
Published Net Asset Value 54,433,792 2.70 57,067,877 2.77
Unrealised loss on revaluation
of investments at bid
/ mid price (ref note
(a) below) (255,641) (0.01) (1,036,982) (0.05)
Reduction in value of
Subsidiary - - (49,000) (0.00)
Registrar fee accrual (2,175) (0.00) - -
Other expense accruals (342) (0.00) - -
Performance fee accrual - - (100,000) (0.00)
Net Asset Value attributable
to shareholders 54,175,634 2.69 55,881,895 2.72
-------------- -------- ------------- --------
(a) In accordance with International Financial Reporting
Standards, as adopted by the European Union, the Group's long
investments have been valued at bid price in the Condensed
Consolidated Financial Statements. However, in accordance with the
Group's principal documents the Net Asset Value reported each month
reflects the investments being valued at the closing, last or
mid-market (as the Directors in all circumstances consider
appropriate) price as notified to the Group on the valuation day by
a member of the stock exchange concerned. Certain investments
remain at fair value as determined in good faith by the
Directors.
7. Earnings per Share and Net Asset Value per Share
The calculation of basic earnings per share for the Ordinary
Share is based on net (loss)/income of GBP(740,261) (30 September
2010 - GBP4,206,744, 31 March 2011 - GBP9,332,489) and the weighted
average number of shares in issue during the period of 20,337,481
shares (30 September 2010 - 21,556,871 shares, 31 March 2011 -
21,082,441). At 30 September 2011 there was no difference in the
diluted earnings per share calculation for the Ordinary Shares.
The calculation of Net Asset Value per Ordinary Share is based
on a Net Asset Value of GBP54,175,634 (30 September 2010 -
GBP50,905,571, 31 March 2011 - GBP55,881,895) and the number of
shares in issue at the period end of 20,140,769 shares (30
September 2010 - 20,628,621 shares, 31 March 2011 - 20,560,769
shares). At 30 September 2011 there was no difference in the
diluted Net Asset Value per share calculation for the Ordinary
Shares.
8. Related Parties
The Investment Adviser is considered to be a related party. The
fees paid are included in the condensed Consolidated Statement of
Comprehensive Income.
At 30 September 2011 GBP98,295 (September 2010 - GBP92,436,
March 2011 - GBP302,563) included in creditors and accrued expenses
was payable to the Investment Adviser.
The Directors are also considered to be related parties and
their fees are disclosed in the condensed Consolidated Statement of
Comprehensive Income.
At 30 September 2011 GBP33,523 (September 2010 - GBP33,523,
March 2011 - GBP29,540) included in creditors and accrued expenses
was payable to the Directors.
Christopher Mills is a Director and shareholder of Oryx
International Growth Fund Limited. As disclosed previously
Christopher Mills is a principal shareholder and Director of JO
Hambro Capital Management (Holdings) Limited, which in turn holds
100% of issued share capital in Harwood Capital LLP (formerly named
North Atlantic Value LLP), the Manager and Investment Adviser.
There were no transactions between the Company and its
subsidiaries in the six months ended 30 September 2011.
Enquiries:
BNP Paribas Fund Services (Guernsey) Limited 01481 750850
Company Secretary
Sara Bourne / Madiha Loveless
Westhouse Securities Limited 020 7601 6118
Alastair Moreton / Hannah Young
This information is provided by RNS
The company news service from the London Stock Exchange
END
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