Aurora Investment - Net Asset Value(s)
03/01/2023 18:25
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RNS Number : 5753L Aurora Investment Trust PLC 03 January 2023
Aurora Investment Trust plc (the 'Company')
LEI: 2138007OUWIZFMAGO575
The Company announces that its unaudited Net Asset Value ("NAV") as at the
close of business on 30 December 2022 was 207.64p per ordinary share
(cum-income).
Investments in the Company's portfolio have been valued on a bid price basis
in the above calculation.
Note on performance fees
The Company's Investment Manager, Phoenix Asset Management Partners Limited
("Phoenix" or the "Investment Manager"), does not earn an ongoing annual
management fee. Instead, the Investment Manager is paid an annual performance
fee, equal to one third of the outperformance of the Company's NAV against its
benchmark, FTSE All-Share Index (total return).
The performance fee is paid by way of the issuance of Ordinary Shares, which
are subject to a fixed three-year clawback period. If the outperformance
versus the index reverses on the third-year anniversary, some or all the
issued shares will be returned by the Investment Manager, and if
outperformance fully reverses, the Investment Manager will receive nothing.
Performance fees are accounted for under IFRS 2 Share Based Payments in the
Company's Interim and Annual Reports. Please refer to the Company's website
for a copy of the latest Annual Report for further details. However, it is
believed that recognising performance fee charge and subsequent clawback on a
liability basis i.e. divergent from IFRS 2, better represents the related
economic impacts on the Company's NAV and is more informative to investors.
Therefore, performance fee charge and subsequent clawback, if applicable, are
recognised on a liability basis in the Company's unaudited daily NAVs.
The Company awarded shares to the Investment Manager in settlement of a
performance fee during the years ended 31 December 2019, 31 December 2020 and
31 December 2021, and no performance fee has been earned for the year ended 31
December 2022.
The clawback period in relation to the performance fee for the year ended 31
December 2019 ended on 31 December 2022 and has resulted in an entitlement to
claw back 530,311 shares from the Investment Manager. The NAV per share has
been adjusted on this basis (i.e. the number of shares in issue has been
reduced by the number being clawed back for the purpose of the calculation),
and the related impact of an increase of 1.66p per share has been reflected in
the unaudited NAV per share as at 30 December 2022.
The clawback periods in relation to performance fee for the years ended 31
December 2020 and 31 December 2021 will end on 31 December 2023 and 31
December 2024, respectively. As at 30 December 2022, 100% clawback for both
periods has been accrued, which has resulted in total NAV improvement of
£2.66m (3.49p per share) and £0.22m (0.29p per share) respectively.
The combined effect of incorporating the clawbacks in the NAV per share as at
30 December 2022 has been an increase of 5.44p per share in total.
For and on behalf of the Board
Frostrow Capital LLP
Secretary
03 January 2023
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