RNS Number:1895I
Resources Investment Trust PLC
21 November 2007
Resources Investment Trust Plc
Preliminary Results for the year ended 30 September 2007
The Directors of Resources Investment Trust plc announce the preliminary results
for the year ended 30 September 2007.
Financial Highlights
The Company was launched in early 2002 with the objective of generating capital
appreciation in the medium to longer term through investing in undervalued
companies in the natural resources sector.
At an Extraordinary General Meeting of the Company held on 3 October 2006 a
special resolution was passed by shareholders which instructed the Board to take
action to realise the Company's investments as soon as reasonably practicable so
as to put the Company in a position to return cash to shareholders by way of
share buy-backs and/or the liquidation of the Company and that the investment
policies of the Company be modified accordingly. As a result of this resolution
and following the Annual General Meeting of the Company held on 14 December 2006
when a special resolution was passed by shareholders authorising the Company to
make market purchases of up to 5,323,060 Ordinary shares (representing 24.99% of
the number of shares in issue at the date of the notice of the meeting, being 21
November 2006), the Company made a tender offer on 10 January 2007 for 5,323,060
of its Ordinary shares at a tender price of 240p per share; the tender offer was
taken up in full.
As the Company continued its share liquidation programme, approximately #36
million of investments had been realised by May 2007. Therefore, another
Extraordinary General Meeting was convened on 15 June 2007 at which a special
resolution was passed authorising the Company to make further market purchases
up to 3,992,826 Ordinary shares (being 24.99% of the number of shares in issue
at the date of the notice of the meeting); the repurchase of the Company's
Ordinary shares was made by way of tender offer at a tender price of 240p per
share and, again, was taken up in full. At the same time, a special resolution
was passed to: (i) amend the articles of association of the Company so as to
extend the time available before winding up from 31 July 2007 to 31 March 2008
in order to allow more time to realise the maximum value of the investments; and
(ii) cancel the Company's share premium account, which cancellation was approved
by the Court on 18 July 2007.
Performance 30 September 30 September % change
2007 2006
Resources Investment Trust plc ('NAV') 256.55p 233.26p +10.0
FTSE All-Share Index 3,316.89 3,050.44 +8.7
HSBC Global Mining Index (benchmark) 719.52 398.56 +80.5
Net Asset Value
The net asset value attributable to the Ordinary shares on 30 September 2007 was
256.6p (2006: 233.3p). The share price of the Ordinary shares on 30 September
2007 was 233.0p (2006: 207.5p) indicating a discount to net asset value of 9.2%
(2006: 11.1%).
Chairman's Statement
Year to 30 September 2007
It has been an eventful year for your Company, heralded by the passing of a
resolution at an Extraordinary General Meeting ("EGM") on 3 October 2006
instructing the Board to wind up the Company by no later than 31 July 2007. As a
result of the outcome of the EGM the Company's management services provider,
Newland Resources Limited ("Newland"), alleged that the Company was in
repudiatory breach of the Management Services Agreement, which was terminated by
Newland on 12 October 2006. Newland had indicated at that time that it would be
seeking damages in the region of #4 million. Earlier this year agreement was
reached between the Company and Newland to settle all claims which either party
had against the other. Under the terms of the settlement, the Company paid
Newland #300,000 on 7 June 2007.
In accordance with the verdict of the EGM your Board moved to liquidate the
portfolio without delay and, to date, #48.8 million out of a total of #50.3
million has been realised. Of this, #22.6 million has been returned to
shareholders by way of two tender offers, each for 24.99% of the then issued
share capital, both of which were taken up in full. The Board and its advisers
have worked hard to achieve the best possible prices for all the holdings, many
of which have limited marketability.
At the EGM to approve the second of the tender offers, shareholder approval was
sought to amend the Articles to extend the time available to the Directors to
wind up the Company until 31 March 2008 and to approve the cancellation of the
share premium account. The Directors believe that it is in shareholders'
interest that the sale of investments is carried out as far as possible under
their supervision rather than simply handed over to a liquidator. Both of these
resolutions were passed and Court approval to the capital reduction was received
on 18 July 2007. Consequently, at the time of writing, the Company has
distributable reserves of #29.7 million.
Shareholders should, by now, be in receipt of a circular requesting shareholder
approval for a further tender offer of up to 90% of the Company's issued share
capital at a tender price of 252p per share. Assuming this is taken up in full
the Company will be left with a small portfolio comprising the less liquid
natural resources investments together with liquid assets amounting, in
aggregate, to #3.6 million. It is hoped that these investments will be realised
in the near future, following which a further EGM will be convened at which a
liquidator will be appointed.
I am pleased to announce that, for the first time in its short history, the
Company is in a position to make a dividend payment to shareholders. An interim
dividend of 2.047p per Ordinary share has been declared for the year ended 30
September 2007. The dividend will be paid on 30 November 2007, together with an
interim dividend of 0.653p per Ordinary share in respect of the year ending 30
September 2008, making a total interim dividend of 2.7p per Ordinary share as
announced on 29 October 2007, to shareholders on the register at close of
business on 9 November 2007.
Before closing my final Chairman's Statement in the context of an Annual Report
I should like to extend sincere thanks to my fellow Board members for the wisdom
and counsel they have brought to bear on the running of your Company. The Board
will complete its stewardship of the Company by ensuring that the maximum value
is extracted for shareholders.
James Dawnay
Chairman
Income Statement
For the year ended 30 September 2007
Year ended 30 September 2007 Year ended 30 September 2006
Revenue Capital Total Revenue Capital Total
# # # # # #
Total capital gains from - 2,781,903 2,781,903 - 17,115,564 17,115,564
investments
Income from fixed asset 1,566,343 - 1,566,343 156,575 - 156,575
investments
Other interest receivable 75,302 - 75,302 40,320 - 40,320
Gross revenue and capital gains 1,641,645 2,781,903 4,423,548 196,895 17,115,564 17,312,459
Management fee - (300,000) (300,000) - (723,368) (723,368)
Performance fee - - - - (2,062,660) (2,062,660)
Administrative expenses (402,417) (69,950) (472,367) (292,802) - (292,802)
Net gain/(loss) on ordinary
activities before interest
payable and taxation 1,239,228 2,411,953 3,651,181 (95,907) 14,329,536 14,233,629
Interest payable - (29,911) (29,911) - (116,181) (116,181)
Net gain/(loss) on ordinary
activities before taxation 1,239,228 2,382,042 3,621,270 (95,907) 14,213,355 14,117,448
Taxation on ordinary activities (108,312) 108,312 - - - -
Net gain/(loss) on ordinary
activities attributable to
equity shareholders 1,130,916 2,490,354 3,621,270 (95,907) 14,213,355 14,117,448
Return/(loss) per Ordinary share
- Basic 6.77p 14.92p 21.69p (0.45p) 66.73p 66.28p
-Diluted 6.77p 14.92p 21.69p (0.45p) 64.46p 64.01p
The Total column represents the Company's profit and loss account for the year.
The supplementary revenue and capital return columns are prepared under guidance
issued by the Association of Investment Companies.
The financial statements do not include a separate Statement of Total Recognised
Gains and Losses as there were no gains or losses other than those reported in
the Income Statement.
All revenue and capital items in the above statement derive from continuing
operations.
No operations were acquired or discontinued during the year.
Reconciliation of Movement in Shareholders' Funds
For the year ended 30 September 2007
Share Share Capital Special Capital Capital Retained
Capital Premium redemption reserve reserve reserve revenue Total
reserve (unrealised) (realised) reserve
# # # # # # # #
At 1 October 1,065,038 19,326,688 - - 12,760,088 3,205,869 (789,680) 35,568,003
2005
Return for the - - - - 8,681,835 5,531,520 (95,907) 14,117,448
year
At 30 1,065,038 19,326,688 - - 21,441,923 8,737,389 (885,587) 49,685,451
September 2006
Return for the - - - - (22,241,055) 24,731,409 1,130,916 3,621,270
year
Transfer to - (19,326,688) - 19,326,688 - - - -
Special
reserve
Cost of shares - - - - - (22,559,520) - (22,559,520)
purchased for
cancellation
Nominal value (465,794) - 465,794 - - - - -
of shares
repurchased
for cancellation
At 30 599,244 - 465,794 19,326,688 (799,132) 10,909,278 245,329 30,747,201
September 2007
The Special reserve was created on 18 July 2007 pursuant to the granting of a
Court Order, and is available to purchase the Company's Ordinary shares.
Balance Sheet
As at 30 September 2007
30 September 30 September
2007 2006
# #
Fixed assets
Investments at fair value through profit or loss 30,471,360 50,307,570
30,471,360 50,307,570
Current assets
Investments held for trading - 171,397
Debtors 334,791 89,660
Cash at bank 62,852 358,558
397,643 619,615
Creditors : amounts falling due within one year (121,802) (1,241,734)
Net current assets/(liabilities) 275,841 (622,119)
Total assets less current liabilities 30,747,201 49,685,451
Total net assets 30,747,201 49,685,451
Capital and reserves
Called up share capital 599,244 1,065,038
Share premium account - 19,326,688
Capital redemption reserve 465,794 -
Special reserve 19,326,688 -
Capital reserve - Realised reserve 10,909,278 8,737,389
- Unrealised reserve (799,132) 21,441,923
Revenue reserve 245,329 (885,587)
Equity shareholders' funds 30,747,201 49,685,451
Net asset value per Ordinary share 256.55p 233.26p
Diluted net asset value per Ordinary share 256.55p 231.66p
Cash flow Statement
For the year ended 30 September 2007
30 September 30 September
2007 2006
# #
Investment income received 1,399,181 85,640
Deposit and other interest received 82,988 36,382
Management fees paid (361,533) (727,383)
Performance fees paid - (2,062,660)
Other cash payments (450,908) (164,302)
Net cash inflow/(outflow) from operating activities 669,728 (2,832,323)
Servicing of finance
Interest paid on bank overdraft (866) -
Interest paid on Unsecured Loan Stock (16,795) (67,185)
Net cash outflow from servicing of finance (17,661) (67,185)
Capital expenditure and financial investment
Purchases of investments (56,391,082) (19,025,650)
Sales of investments 79,383,057 20,314,562
Realised currency losses (46,787) (105,699)
Net cash inflow from capital expenditure and financial
investment 22,945,188 1,183,213
Net cash inflow/(outflow) before financing 23,597,255 (1,716,295)
Financing
Repayment of Unsecured Loan Stock (1,119,750) -
Repurchase of shares for cancellation (22,559,520) -
Net cash outflow from financing (23,679,270) -
Decrease in cash (82,015) (1,716,295)
Reconciliation of net cash outflow to
movement in net cash/(debt)
Decrease in cash (82,015) (1,716,295)
Repayment of Unsecured Loan Stock 1,119,750 -
Exchange loss on revaluation of bank balances (213,691) -
Amortisation of Unsecured Loan Stock issue expenses (12,250) (48,996)
Movement in net cash/(debt) for the year 811,794 (1,765,291)
Net (debt)/cash at beginning of year (748,942) 1,016,349
Net cash/(debt) at 30 September 2007 62,852 (748,942)
Notes:
This preliminary statement is not the Company's statutory accounts. The
statutory accounts for the year ended 30 September 2006 have been delivered to
the Registrar of Companies and received an audit report which was unqualified
and did not contain statements under s237(2) and (3) of the Companies Act 1985.
The statutory accounts for the year ended 30 September 2007 have not yet been
approved, audited or filed.
The Report and Accounts will be posted to shareholders. Copies may be obtained
during normal business hours from the Company's registered office, The Registry,
34 Beckenham Road, Beckenham, Kent, BR3 4TU.
By Order of the Board
Capita Company Secretarial Services Limited, Secretary
21 November 2007
This information is provided by RNS
The company news service from the London Stock Exchange
END
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