REG - Bankers Investment - Half-year Report
26/06/2024 07:00
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RNS Number : 8390T Bankers Investment Trust PLC 26 June 2024
LEGAL ENTITY IDENTIFIER: 213800B9YWXL3X1VMZ69
THE BANKERS INVESTMENT TRUST PLC
('the Company')
Unaudited results for the half-year ended 30 April 2024
This announcement contains regulated information
INVESTMENT OBJECTIVE
Over the long term, the Company aims to achieve capital growth in excess of
the FTSE World Index and dividend growth greater than inflation, as measured
by the UK Consumer Price Index ('CPI'), by investing in companies listed
throughout the world.
INVESTMENT POLICY
The following investment ranges apply:
· Equities: 80% to 100%
· Debt securities and cash investments: 0% to 20%
· Investment trusts, collective funds and derivatives: 0% to 15%
To achieve an appropriate spread of investment risk the portfolio is broadly
diversified by geography, sector and company. The Manager ('Janus Henderson')
has the flexibility to invest in any geographic region and any sector with no
set limits on individual country or sector exposures and, therefore, the
make-up and weighting of the portfolio may differ materially from the FTSE
World Index.
The Manager primarily employs a bottom-up stock picking investment process,
across six regional portfolios, to identify suitable opportunities. While each
regional portfolio manager employs their own investment style, they all pay
particular regard to cash generation and dividend growth over the medium term.
The Company can, but normally does not, invest up to 15% of its gross assets
in any other investment companies (including listed investment trusts).
Derivatives
The Company may use financial instruments known as derivatives for the purpose
of efficient portfolio management while maintaining a level of risk consistent
with the risk profile of the Company.
Gearing
The Company can borrow to make additional investments with the aim of
achieving a return that is greater than the cost of the borrowing. The Company
can borrow up to 20% of net assets at the time of draw down.
PERFORMANCE HIGHLIGHTS
30 April 2024 30 April 2023
Net asset value ('NAV') per share(1) 122.7p 112.3p
Share price 112.2p 100.6p
Revenue return per share 1.31p 1.29p
Dividends paid or declared in respect of the period(2) 1.344p 1.24p
Total return performance to 30 April 2024 (including dividends reinvested and
excluding transaction costs)
6 months 1 year 3 years 5 years 10 years
% % % % %
NAV(3) 17.5 14.3 17.0 50.5 174.0
FTSE World Index(4) 16.6 19.1 30.4 72.8 149.4
Share price(5) 21.5 14.4 5.2 38.4 154.5
1 Net asset value per share with debt at par
2 The first interim dividend for 2024 was paid on 31 May 2024; the second
interim dividend has been declared and will be paid on 30 August 2024
3 Net asset value total return per share with income reinvested and with debt
at fair value
4 For 10 years, the benchmark is a composite of the FTSE World Index and the
FTSE All-Share Index
5 Share price total return using mid-market closing price
Sources: Janus Henderson, Morningstar Direct and LSEG Datastream
INTERIM MANAGEMENT REPORT
CHAIR'S STATEMENT
Dear shareholder
Performance
Your Company has delivered a strong net asset value total return over the six
months ended 30 April 2024 of 17.5% (2023: 8.1%) and a share price total
return of 21.5% (2023: 5.4%), both returns outperforming the FTSE World Index
total return of 16.6% (2023: 3.5%). Stock markets around the world rose in
value principally due to solid corporate profit recovery exceeding forecasts
by analysts. The anticipated tailwind of interest rate cuts from central banks
never materialised as inflation remained higher than expected. The Fund
Manager discusses the key drivers of performance in the period in more detail
in his report.
Following a strategic review, our Manager has started a process of
concentrating the portfolio into four regional portfolios and reducing the
number of holdings to approximately 100. This will direct a greater amount of
the Company's capital into the portfolio managers' best investment ideas and
bring greater focus to the regional portfolios. The reduction in portfolios
from six to four will create a Pan European portfolio, incorporating the UK,
and a Pan Asian (ex Japan) portfolio, including the Chinese A shares. This
will reduce the overlap within these regions and remove potential conflicts.
We continue to believe in the value of regional specialists with access to
stock markets right across the globe.
We are also pleased to announce that Jamie Ross, our European portfolio
manager, will assume the role of Deputy Fund Manager, following the recent
retirement of Mike Kerley. Jamie has over 17 years of financial industry
experience and has been a member of the Company's investment team since late
2018. We look forward to working more closely with Jamie alongside our Fund
Manager, Alex Crooke.
Revenue
Our net revenue for the six months was £15.9 million (2023: £16.5 million),
equivalent to 1.31p per share (2023: 1.29p). The reduction in revenue was a
result of lower interest income, partially offset by a lower finance cost
following the repayment of the 8% 2023 debenture on 31 October 2023. A reduced
share count following share buybacks resulted in the earnings per share
increasing by 1.6% over the period.
A first interim dividend of 0.672p per share (2023: 0.62p) was paid on 31 May
2024. The Board has declared a second interim dividend of 0.672p (2023:
0.62p) per share, an increase of 8.4%, which will be payable on 30 August 2024
to shareholders on the register on 26 July 2024.
The Board's current expectation is that the dividend for the full year will be
at least 5% above the total dividend paid in 2023. This continues the
Company's progressive dividend policy of successive annual dividend growth
which it has achieved over the past 57 years.
Share buy-backs
The Company's share price has continued to trade at a wide discount to its net
asset value and we have taken advantage of this opportunity to buy back shares
from the market. This activity is beneficial to ongoing shareholders, as
shares are only purchased when the Company's shares are trading at a discount
to NAV, thereby enhancing shareholder value.
A total of 49,748,991 shares were bought back at an average discount of 12.3%
to the net asset value in the six months ended 30 April 2024 (2023: 24,080,927
shares bought back at an average discount of 9.0%) for a total consideration
of £53.4 million (2023: £24.9 million). The discount at 30 April 2024 was
8.6% (2023: 10.4%).
Board changes
As mentioned at the year end, Julian Chillingworth retired from the Board at
the Annual General Meeting in February 2024, having served as a Director for
nine years, and as Senior Independent Director for the latter five years of
his tenure. Richard West, who joined the Board on 1 April 2020, was appointed
as the Company's Senior Independent Director on 23 April 2024.
Outlook
Economic recovery is now under way in the European and Chinese markets while
growth remains robust in the US and Japan. Corporate earnings should therefore
be expected to continue to grow, supported at some point by interest rate cuts
later this year or next. While share price returns to date have discounted
some of this positive outlook, valuations do not look stretched which will
ensure that your Company is well placed to continue to grow.
Simon Miller
Chair
25 June 2024
FUND MANAGER'S
REPORT
Market Review
The six month period to the end of April 2024 has been a good time to be
invested in equity markets, as a strong recovery in share prices led to most
markets reaching new all-time highs. Investors were optimistic that fading
price inflation would lead to the tight monetary policy being eased by rate
cuts. However, as it turned out, rates were not cut during the period in any
major market and instead it was the delivery of stronger-than-expected
corporate profits that underpinned higher share prices. In most sectors,
companies experienced improving margins as higher prices stuck and energy
costs fell.
The US market was marginally the better performer during the period, closely
followed by Europe, Japan and the UK. The best performing stocks continued to
be those focused on delivering artificial intelligence ('AI') solutions,
particularly in the US market. However, recovery was fairly broad based in
most markets as financials, industrials and retail exposed companies performed
best, while energy, utilities and telecoms were laggards.
Performance
As indicated in the Annual Report, a number of new holdings were purchased in
zero yielding US technology companies, including Alphabet, Amazon and Meta.
Results from these companies were well received during the period, as margins
grew strongly on the back of reducing costs by closing loss-making divisions
and growing revenues. The technology exposure in the overall portfolio was
increased from 16.3% to 22.3%. Despite these new additions, performance in the
US portfolio continued to lag the benchmark, driven principally by lack of
exposure to Nvidia. There is exposure to semiconductor manufacture across a
wide spectrum of technologies in each of the Japanese, US, Asian and European
portfolios. However, Nvidia is garnering all the exposure, and investors
chasing returns. Undoubtedly they are the leader in developing AI chips, but
we do have concerns that new orders will start to plateau leading to pricing
pressure, ultimately impacting their share price.
Performance in the Japanese portfolio was considerably better than the
benchmark, delivering a return nearly 5% ahead. This was driven by recovery in
financials as the Bank of Japan raised interest rates for the first time since
2007, ending the period of negative interest rates. The Yen weakened over the
period but the stock market recovery more than made up for this, delivering a
total return of 20.2% over the period. The European, Asian and Chinese
portfolios also delivered returns in excess of their benchmarks.
Portfolio
The portfolio has grown in both the number of regions and stocks over the past
decade, delivering diversification and access to new markets such as China and
India. However this has thrown up conflicts as companies can be dual listed
and choices within sectors have narrowed due to consolidation by merger or
acquisition. We have therefore decided to consolidate the number of regions to
four: North America, Pan Europe (to include the UK), Pan Asia (ex Japan) and
Japan. We will continue to invest directly in the UK and Chinese markets but
with a single investment team overseeing these regions with greater scope to
invest more capital in the best companies across wider regions. Jamie Ross,
supported by myself, will manage the Pan European portfolio and Sat Duhra will
manage the Pan Asian portfolio.
Additionally, we have conducted a careful review of stock selection and
portfolio construction. The conclusion of this work was that smaller holdings
were not improving performance and by concentrating the portfolios, we would
have a higher active stance, an indicator of greater divergence from the
index. We therefore intend to increase the amount of capital in our best ideas
by reducing the number of holdings towards 100. We will target regional
portfolios of 20 investments with slightly more in the US, as it is a market
with significantly more listed companies and therefore investment
opportunities. We expect the tighter concentrated portfolio to be
substantially implemented by the end of October 2024.
Outlook
We are excited by the prospect of a focused portfolio, investing more in our
best ideas. In meetings with our investee companies, we are hearing positive
messages about orders improving, restocking from customers and margins holding
up. Inflation has fallen close to central bank targets and the first interest
rate cuts have started in major economic regions. The overall outlook is more
positive than six months ago and should support the increase in share prices
we have seen this year.
Alex Crooke
Fund Manager
25 June 2024
MANAGING OUR RISKS
The principal and emerging risks and uncertainties associated with the
Company's business are divided into the following main areas:
· Investment Activity and Performance Risks
· Portfolio and Market Risks
· Tax, Legal, Regulatory and Governance Risks
· Financial Risks
· Operational and Cyber Risks
· Risks associated with Climate Change
Information on these risks and uncertainties and how they are managed are
given in the Annual Report for the year ended 31 October 2023. Following a
recent review, the Board has amended Tax, Legal and Regulatory Risk to include
Governance. All other principal and emerging risks at the year-end remain and
are as applicable to the remaining six months of the financial year as they
were to the six months under review.
DIRECTORS' RESPONSIBILITY STATEMENT
The Directors (listed in note 15) confirm that, to the best of their
knowledge:
(a) the unaudited condensed set of financial statements has been prepared in
accordance with IAS 34 - Interim Financial Reporting ('IAS 34') and gives a
true and fair view of the assets, liabilities, financial position and profit
or loss of the Company as required by Disclosure Guidance and Transparency
Rule 4.2.4R;
(b) the interim management report includes a fair review of the information
required by Disclosure Guidance and Transparency Rule 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
(c) the interim management report includes a fair review of the information
required by Disclosure Guidance and Transparency Rule 4.2.8R (disclosure of
related party transactions that have taken place in the first six months of
the current financial year and that have materially affected the financial
position or the performance of the Company during the period; and any changes
in related party transactions described in the latest annual report that could
have an impact in the first six months of the current financial year).
On behalf of the Board
Simon Miller
Chair
25 June 2024
For further information contact:
Alex Crooke Simon Miller
Fund Manager Chair
The Bankers Investment Trust PLC The Bankers Investment Trust PLC
Telephone: 020 7818 4447 Telephone: 020 7818 4233
Dan Howe Harriet Hall
Head of Investment Trusts PR Director, Investment Trusts
Janus Henderson Investors Janus Henderson Investors
Telephone: 020 7818 4458 Telephone: 020 7818 2636
CONDENSED STATEMENT OF COMPREHENSIVE INCOME
(Unaudited) (Unaudited) (Audited)
Half-year ended Half-year ended Year ended
30 April 2024 30 April 2023 31 October 2023
Revenue return £'000 Capital return £'000 Revenue return £'000 Capital return £'000 Revenue return £'000 Capital return £'000
Total £'000 Total £'000 Total
£'000
Gains on investments held at fair value through profit or loss - 177,057 177,057 - 93,419 93,419 - 37,376 37,376
Investment income 19,107 - 19,107 19,070 - 19,070 40,439 - 40,439
Other operating income 567 - 567 1,073 - 1,073 1,326 - 1,326
--------- ----------- --------- --------- ----------- --------- ----------- ------------ ------------
Gross revenue and capital gains 19,674 177,057 196,731 20,143 93,419 113,562 41,765 37,376 79,141
---------- ------------ ----------- ---------- ------------ ----------- ------------ ----------- ------------
Expenses
Management fees (note 2) (910) (2,123) (3,033) (887) (2,071) (2,958) (1,790) (4,176) (5,966)
Other expenses (642) - (642) (378) - (378) (970) - (970)
--------- ----------- --------- --------- ----------- --------- --------- --------- ---------
Profit before finance costs and taxation 18,122 174,934 193,056 18,878 91,348 110,226 39,005 33,200 72,205
Finance costs (519) (1,151) (1,670) (712) (1,573) (2,285) (3,211) (4,587)
(1,376)
--------- ------------ --------- --------- ------------ --------- --------- ------------ ------------
Profit before taxation 17,603 173,783 191,386 18,166 89,775 107,941 37,629 29,989 67,618
--------- ---------- --------- --------- ---------- --------- --------- ---------- ---------
Taxation (1,662) (59) (1,721) (1,623) - (1,623) (3,061) - (3,061)
--------- ------------ --------- --------- ------------ --------- --------- ---------- ---------
Profit for the period 15,941 173,724 189,665 16,543 89,775 106,318 34,568 29,989 64,557
===== ======= ====== ===== ======= ====== ====== ======= =======
Earnings per ordinary share (note 3) 1.31p 14.31p 15.62p 1.29p 6.97p 8.26p 2.72p 2.35p 5.07p
===== ====== ====== ===== ====== ====== ====== ======= =======
The total columns of this statement represent the Statement of Comprehensive
Income, prepared in accordance with UK adopted international accounting
standards. The revenue return and capital return columns are supplementary to
this and are prepared under guidance published by the Association of
Investment Companies.
All income is attributable to the equity shareholders of The Bankers
Investment Trust PLC.
The accompanying condensed notes are an integral part of the financial
statements.
CONDENSED STATEMENT OF CHANGES IN EQUITY
Called up Share premium Capital redemption Other capital reserves £'000
share capital account reserve Revenue reserve
£'000 £'000 £'000 £'000 Total
£'000
Half-year ended 30 April 2024 (Unaudited)
Total equity at 1 November 2023 32,878 159,797 12,489 1,084,848 43,511 1,333,523
Total comprehensive income:
- Profit for the period - - - 173,724 15,941 189,665
Transactions with owners, recorded
directly to equity:
Buy-back of shares to treasury (note 5) - - - (53,389) - (53,389)
Ordinary dividends paid (note 12) - - - - (16,205) (16,205)
---------- ---------- ---------- ------------- ---------- --------------
Total equity at 30 April 2024 32,878 159,797 12,489 1,205,183 43,247 1,453,594
====== ====== ====== ======== ====== ========
Called up Share premium Capital redemption Other capital
share capital account £'000 reserve reserves Revenue reserve
£'000 £'000 £'000 £'000 Total
Half-year ended 30 April 2023 (Unaudited) £'000
Total equity at 1 November 2022 32,878 159,797 12,489 1,115,343 40,159 1,360,666
Total comprehensive income:
- Profit for the period - - - 89,775 16,543 106,318
Transactions with owners, recorded
directly to equity:
Buy-back of shares to treasury (note 5) - - - (24,881) - (24,881)
Ordinary dividends paid (note 12) - - - - (15,535) (15,535)
---------- ---------- ---------- ------------- ---------- --------------
Total equity at 30 April 2023 32,878 159,797 12,489 1,180,237 41,167 1,426,568
====== ====== ====== ======== ====== ========
Called up Share premium Capital redemption Other capital
share capital account £'000 reserve £'000 reserves Revenue reserve Total
£'000 £'000 £'000 £'000
Year ended 31 October 2023 (Audited)
Total equity at 1 November 2022 32,878 159,797 12,489 1,115,343 40,159 1,360,666
Total comprehensive income:
- Profit for the year - - - 29,989 34,568 64,557
Transactions with owners, recorded directly to equity:
Buy-back of shares to treasury (note 5) - - - (60,484) - (60,484)
Ordinary dividends paid (note 12) - - - - (31,216) (31,216)
---------- ---------- ----------- ------------- ---------- -------------
Total equity at 31 October 2023 32,878 159,797 12,489 1,084,848 43,511 1,333,523
====== ====== ====== ======== ====== ========
The accompanying condensed notes are an integral part of the financial
statements.
CONDENSED STATEMENT OF FINANCIAL POSITION
(Unaudited) (Unaudited) (Audited)
As at 30 April As at 30 April As at 31 October
2024 2023 2023
£'000 £'000 £'000
Non-current assets
Investments held at fair value through profit or loss 1,530,994 1,489,862 1,428,787
------------- ------------- --------------
Current assets
Investments held at fair value through profit or loss (note 4) 21,509 26,353 13,116
Other receivables 7,128 13,619 19,001
Cash and cash equivalents 28,726 43,863 14,525
-------------- -------------- --------------
57,363 83,835 46,642
-------------- -------------- --------------
Total assets 1,588,357 1,573,697 1,475,429
-------------- -------------- --------------
Current liabilities
Other payables (10,604) (6,801) (17,006)
Debenture stock - (15,000) -
-------------- -------------- --------------
(10,604) (21,801) (17,006)
-------------- -------------- --------------
Total assets less current liabilities 1,577,753 1,551,896 1,458,423
-------------- -------------- --------------
Non-current liabilities
Unsecured loan notes (124,159) (125,328) (124,900)
-------------- -------------- --------------
Net assets 1,453,594 1,426,568 1,333,523
======== ======== ========
Equity attributable to equity shareholders
Share capital (note 5) 32,878 32,878 32,878
Share premium account 159,797 159,797 159,797
Capital redemption reserve 12,489 12,489 12,489
Retained earnings:
Other capital reserves 1,205,183 1,180,237 1,084,848
Revenue reserve 43,247 41,167 43,511
-------------- -------------- --------------
Total equity 1,453,594 1,426,568 1,333,523
======== ======== ========
Net asset value per ordinary share (note 6) 122.7p 112.3p 108.0p
====== ====== ======
The accompanying condensed notes are an integral part of the financial
statements.
CONDENSED CASH FLOW STATEMENT
(Unaudited) (Unaudited) (Audited)
Half-year ended Half-year ended Year ended
30 April 30 April 31 October
Reconciliation of profit before taxation to net cash flow 2024 2023 2023
from operating activities £'000 £'000 £'000
Operating activities
Profit before taxation 191,386 107,941 67,618
Less: gain on investments held at fair value through profit or loss (177,057) (93,419) (37,376)
Purchases of investments (353,778) (611,067) (830,071)
Sales of investments 428,187 649,246 872,865
Indian capital gains tax paid on sales (59) - -
Purchases of current asset investments (49,907) (44,581) (80,700)
Sales of current asset investments 41,514 18,229 67,585
Increase in securities purchased for future settlement 13,540 2,915 12,119
Increase in securities sold for future settlement (6,271) (5,983) -
Increase in other receivables (32) (87) (58)
Decrease in other payables (104) (236) (169)
Increase in accrued income (1,651) (2,854) (14,217)
Add back interest payable ('finance costs') 1,670 2,285 4,587
------------ ------------ ------------
Net cash inflow from operating activities 87,438 22,389 62,183
before interest and taxation
Interest paid (2,438) (1,265) (4,525)
Taxation on investment income (1,647) (1,822) (3,290)
------------ ------------ -------------
Net cash inflow from operating activities 83,353 19,302 54,368
======= ======= =======
Financing activities
Equity dividends paid (16,205) (15,535) (31,216)
Redemption of debenture - - (15,000)
Share buy-backs (53,389) (24,881) (59,579)
------------ ------------ -------------
Net cash outflow from financing activities (69,594) (40,416) (105,795)
======= ======= =======
Increase/(decrease) in cash 13,759 (21,114) (51,427)
Cash and cash equivalents at the start of the period 14,525 65,871 65,871
Exchange movements 442 (894) 81
----------- ----------- -------------
Cash and cash equivalents at the end of the period 28,726 43,863 14,525
======= ======= =======
The accompanying condensed notes are an integral part of the financial
statements.
NOTES TO THE CONDENSED FINANCIAL STATEMENTS:
1. Accounting policies
The Bankers Investment Trust PLC ('the Company') is a company incorporated and
domiciled in the United Kingdom under the Companies Act 2006.
These condensed financial statements comprise the unaudited results of the
Company for the half-year ended
30 April 2024. They have been prepared on a going concern basis and in
accordance with UK adopted international accounting standards and with the
Statement of Recommended Practice for Investment Trusts ('SORP') dated July
2022, where the SORP is consistent with the requirements of UK adopted
international accounting standards.
For the period under review, the Company's accounting policies have not varied
in any material way from those described in the Annual Report for the year
ended 31 October 2023.
These financial statements have not been either audited or reviewed by the
Company's Auditor.
2. Management fees
(Unaudited) (Unaudited) (Audited)
Half-year ended Half-year ended Year ended
30 April 2024 30 April 2023 31 October 2023
Revenue return Capital return Total Revenue Capital return Total Revenue return Capital return Total
£'000 £'000 £'000 return £'000 £'000 £'000 £'000 £'000
£'000
Investment management 910 2,123 3,033 887 2,071 2,958 1,790 4,176 5,966
===== ===== ===== ===== ===== ===== ===== ===== =====
3. Earnings per ordinary share
The earnings per ordinary share figure is based on the net profit for the
half-year of £189,665,000 (30 April 2023: net profit of £106,318,000; 31
October 2023: net profit of £64,557,000) and on 1,214,507,013 (30 April 2023:
1,286,965,652; 31 October 2023: 1,272,116,196) ordinary shares, being the
weighted average number of ordinary shares in issue excluding treasury shares
during the period.
The return per share detailed above can be further analysed between revenue
and capital, as below.
(Unaudited) (Unaudited) (Audited)
Half-year ended Half-year ended Year ended
30 April 2024 30 April 2023 31 October 2023
£'000 £'000 £'000
Revenue profit 15,941 16,543 34,568
Capital profit 173,724 89,775 29,989
------------ ------------ ------------
Total profit 189,665 106,318 64,557
======= ======= =======
Weighted average number of ordinary shares 1,214,507,013 1,286,965,652 1,272,116,196
in issue during each period
Revenue earnings per ordinary share 1.31p 1.29p 2.72p
Capital earnings per ordinary share 14.31p 6.97p 2.35p
------------ ------------ ------------
Total earnings per ordinary share 15.62p 8.26p 5.07p
======= ======= =======
4. Current asset investment
The Company has a holding in the Deutsche Bank Global Liquidity Series Fund, a
money market fund which is viewed as a readily disposable store of value and
which is used to invest cash balances that would otherwise be placed on
short-term deposit. At 30 April 2024 this holding had a value of £21,509,000
(30 April 2023: £26,353,000; 31 October 2023: £13,116,000).
5. Share capital
At 30 April 2024 there were 1,315,102,830 ordinary shares of 2.5p each in
issue of which 130,619,544 were held in treasury (with no voting rights) (30
April 2023: 1,315,102,830 of which 44,332,551 shares were held in treasury; 31
October 2023: 1,315,102,830 of which 80,870,553 shares were held in treasury).
During the half-year ended 30 April 2024, 49,748,991 shares were bought back
into treasury at a total cost of £53,389,000 (half year to 30 April 2023:
24,080,927 shares were bought back into treasury for a total cost of
£24,881,000; year to 31 October 2023: 60,618,929 shares were bought back into
treasury for a total cost of £60,484,000). Since the period end, the Company
has bought back 11,181,474 shares for a total cost of £12,625,000.
6. Net asset value per ordinary share
The net asset value per ordinary share is based on the net assets attributable
to equity shareholders of £1,453,594,000 (30 April 2023: £1,426,568,000; 31
October 2023: £1,333,523,000) and on 1,184,483,286
(30 April 2023: 1,270,770,279; 31 October 2023: 1,234,232,277) ordinary
shares, being the number of ordinary shares in issue with voting rights at the
period end.
7. Bank loan
The Company's multi-currency loan facility with SMBC Bank International plc
expired on 1 March 2024 and has not been renewed.
8. Related party transactions
The Company's transactions with related parties during the period were with
its Directors and Janus Henderson. There have been no material transactions
between the Company and its Directors during the period other than the amounts
paid to them in respect of Directors' remuneration for which there were no
outstanding amounts payable at the period end.
In relation to the provision of services by Janus Henderson, other than fees
payable by the Company in the ordinary course of business and the provision of
marketing services, there have been no transactions with Janus Henderson
affecting the financial position or performance of the Company during the
period under review.
9. Financial instruments
At the period end the carrying value of financial assets approximates their
fair value.
Financial instruments carried at fair value
Fair value hierarchy
The debenture stock and unsecured loan notes are valued at par in the
Statement of Financial Position. The fair value of the 8% debenture stock at
30 April 2024 was £n/a (30 April 2023: £15,224,000; 31 October 2023: £n/a).
The fair value of the debenture stock was calculated using prices quoted on
the exchange on which the instrument trades and was categorised as Level 1 as
described below.
The fair value of the loan notes at 30 April 2024 has been estimated to be
£91,757,000 (30 April 2023: £94,815,000; 31 October 2023: £88,985,000) and
is categorised as level 3 in the fair value hierarchy as described below. This
has been reflected in the daily NAV announcements since January 2024.
Previously the unsecured loan notes were valued at amortised cost in the fair
value NAV.
The following table analyses recurring fair value measurements for financial
assets. These fair value measurements are categorised into different levels in
the fair value hierarchy based on the inputs to valuation techniques used.
Financial assets at fair value through profit or loss at 30 April 2024 Level 1 Level 2 Level 3 Total
(Unaudited)
£'000 £'000 £'000 £'000
Investments including derivatives:
- Equity investments 1,530,994 - - 1,530,994
- Fixed interest investments - - - -
- Current asset investments 21,509 - - 21,509
-------------- --------- -------- --------------
Total financial assets carried at fair value 1,552,503 - - 1,552,503
======== ===== ==== ========
Financial assets at fair value through profit or loss at 30 April 2023 Level 1 Level 2 Level 3 Total
(Unaudited)
£'000 £'000 £'000 £'000
Investments including derivatives:
- Equity investments 1,489,862 - - 1,489,862
- Fixed interest investments - - - -
- Current asset investments 26,353 - - 26,353
-------------- --------- -------- --------------
Total financial assets carried at fair value 1,516,215 - - 1,516,215
======== ===== ==== ========
Financial assets at fair value through profit or loss at 31 October 2023 Level 1 Level 2 Level 3 Total
(Unaudited)
£'000 £'000 £'000 £'000
Investments including derivatives:
- Equity investments 1,428,787 - - 1,428,787
- Fixed interest investments - - - -
- Current asset investments 13,116 - - 13,116
-------------- --------- -------- --------------
Total financial assets carried at fair value 1,441,903 - - 1,441,903
======== ===== ==== ========
Level 3 investments at fair value through profit or loss (Unaudited) (Unaudited) (Audited)
Half-year ended Half-year Year ended
30 April 2024 ended 31 October 2023
£'000 30 April 2023 £'000
£'000
Opening balance - 1 -
Disposal proceeds - (1) -
------ ------ ------
Closing balance - - -
==== ==== ====
10. Reconciliation of liabilities arising from financing activities
Non-cash changes
At Cash Amortisation Foreign At
1 November flows of issue costs exchange 30 April
2023 £'000 £'000 £'000 2024
£'000 £'000
Financing activities
Financing liabilities 124,900 - 14 (755) 124,159
----------- ------- -------- --------- ------------
Closing liabilities from 124,900 - 14 (755) 124,159
financing activities
======= ==== ==== ===== =======
Non-cash changes
At Cash Amortisation Foreign At
1 November flows of issue costs exchange 30 April
2022 £'000 £'000 £'000 2023
£'000 £'000
Financing activities
Financing liabilities 139,280 - 12 1,036 140,328
----------- ------- -------- --------- ------------
Closing liabilities from 139,280 - 12 1,036 140,328
financing activities
======= ==== ==== ===== =======
Non-cash changes
At Cash Amortisation Foreign At
1 November flows of issue costs exchange 31 October 2023
2022 £'000 £'000 £'000 £'000
£'000
Financing activities
Financing liabilities 139,280 (15,000) 62 558 124,900
---------- ----------- -------- --------- ------------
Closing liabilities from 139,280 (15,000) 62 558 124,900
financing activities
====== ======= ==== ===== ======
11. Going concern
In assessing the Company's going concern, the Directors have considered among
other things, cash flow forecasts, a review of covenant compliance including
the headroom above the most restrictive covenants, an assessment of the
liquidity of the portfolio and the impact of the war in Ukraine and the
Gaza-Israel conflict. The assets of the Company consist mainly of securities
that are listed and readily realisable. Thus, after making due enquiry, the
Directors believe that the Company has adequate financial resources to meet
its financial obligations, including the repayment of any borrowings, and to
continue in operational existence for at least 12 months from the date of
approval of the financial statements. Accordingly, the Directors continue to
adopt the going concern basis in preparing the financial statements.
12. Dividends
A first interim dividend of 0.672p (2023: 0.62p) per ordinary share was paid
on 31 May 2024 to shareholders registered on 26 April 2024. The shares were
quoted ex-dividend on 25 April 2024. Based on the number of ordinary shares in
issue at 25 April 2024 (excluding the shares held in treasury) of
1,184,483,286 the cost of this dividend was £7,960,000.
The Directors have declared a second interim dividend of 0.672p (2023: 0.62p)
per ordinary share which will be payable on 30 August 2024 to shareholders on
the register on 26 July 2024. The shares will be quoted ex-dividend on 25 July
2024. Based on the number of shares in issue, excluding shares held in
treasury, at 25 June 2024 of 1,173,301,812 the cost of this dividend will be
£7,885,000.
13. Comparative information
The financial information contained in this half-year report does not
constitute statutory accounts as defined in Section 434 of the Companies Act
2006. The financial information for the half-years ended 30 April 2024 and
2023 have not been audited or reviewed by the Auditor.
The figures and financial information for the year ended 31 October 2023 have
been extracted from the latest published financial statements of the Company.
These financial statements have been delivered to the Registrar of Companies
and included the report of the Auditor which was unqualified and did not
contain a statement under either section 498(2) or 498(3) of the Companies Act
2006. A glossary of terms and details of alternative performance measures can
be found in the Annual Report for the year ended 31 October 2023.
14. Half-year report
The half-year report will be available on the Company's website
(www.bankersinvestmenttrust.com) or in hard copy from the Company's registered
office. An abbreviated version of this half-year report, the 'Update', will be
circulated to shareholders in early July 2024.
15. General information
Company status
The Company is a UK domiciled investment trust company.
London Stock Exchange Daily Official List (SEDOL): BN4NDR3 / ISIN number:
GB00BN4NDR39
London Stock Exchange (TIDM) Code: BNKR
New Zealand Stock Exchange Code: BIT
Global Intermediary Identification Number (GIIN): L5YVFP.99999.SL.826
Legal Entity Identifier (LEI): 213800B9YWXL3X1VMZ69
Registered Office
201 Bishopsgate, London EC2M 3AE.
Company Registration Number
UK: 00026351
NZ: 645360
Directors
The Directors of the Company are Simon Miller (Chair), Richard West (Senior
Independent Director), Ankush Nandra (Audit & Risk Assurance Committee
Chair), Hannah Philp (Marketing Committee Chair) and Charlotte Valeur.
Corporate Secretary
Janus Henderson Secretarial Services UK Limited, represented by Wendy King
FCG.
Website
Details of the Company's share price and net asset value, together with
general information about the Company, monthly factsheets and data, copies of
announcements, reports and details of general meetings can be found at
www.bankersinvestmenttrust.com (http://www.bankersinvestmenttrust.com) .
50 Largest Investments
At 30 April 2024
Rank Rank Company Country Valuation Purchases Sales proceeds Appreciation/ Valuation
31 Oct
(depreciation)
30 Apr
30 Apr 2024 31 Oct 2023
£'000 £'000
2023 £'000 2024
£'000 £'000
1 1 Microsoft US 57,500 - - 6,649 64,149
2 5 KLA Corp US 20,579 - - 8,645 29,224
3 12 American Express US 14,457 4,827 - 8,814 28,098
4 3 Accenture US 28,251 - - (520) 27,731
5 # Amazon US - 25,028 - 741 25,769
6 # Alphabet US - 21,730 - 3,641 25,371
7 7 Visa US 19,047 4,132 - 1,974 25,153
8 4 UnitedHealth US 21,616 2,681 - (2,845) 21,452
9 2 Apple US 30,506 - (8,857) (368) 21,281
10 18 CME US 12,928 8,491 - (412) 21,007
11 10 Toyota Motor Japan 16,790 - (1,176) 5,215 20,829
12 11 Novo Nordisk Denmark 15,734 - - 4,853 20,587
13 # Morgan Stanley US 8,831 7,819 - 2,550 19,200
14 20 Chevron US 12,592 5,343 - 1,105 19,040
15 9 TotalEnergies France 16,810 - - 1,075 17,885
16 # Meta US - 15,320 - 2,009 17,329
17 13 McDonald's US 13,802 3,030 - (53) 16,779
18 19 Deere US 12,667 3,115 - 530 16,312
19 15 Texas Instruments US 13,412 - - 2,722 16,134
20 21 Oracle US 12,288 1,269 - 861 14,418
21 # ASML Netherlands 8,770 1,731 - 3,883 14,384
22 47 BP UK 9,198 4,651 (832) 884 13,901
23 17 Procter & Gamble US 13,092 - - 710 13,802
24 37 Starbucks US 9,785 4,476 - (940) 13,321
25 8 AstraZeneca UK 17,286 - (6,140) 2,172 13,318
26 40 Marriott US 9,608 1,620 - 2,059 13,287
27 32 Lloyds Banking UK 10,370 438 (773) 3,153 13,188
28 # Lam Research US 8,660 298 - 4,181 13,139
29 41 Eli Lilly US 9,556 - - 3,509 13,065
50 Largest Investments continued
At 30 April 2024
Rank Rank Company Country Valuation Purchases Sales proceeds Appreciation/ Valuation
31 Oct
(depreciation)
30 Apr
30 Apr 2024 31 Oct 2023
£'000 £'000
2023 £'000 2024
£'000 £'000
30 # Hershey US 7,789 5,021 - 145 12,955
31 33 Hitachi Japan 10,313 - (2,309) 4,435 12,439
32 28 Nike US 10,765 3,233 - (1,656) 12,342
33 # Daiichi Sankyo Japan 8,892 1,228 (755) 2,738 12,103
34 27 Abbott Laboratories US 11,026 114 - 956 12,096
35 # Constellation Brands US 4,707 6,778 - 471 11,956
36 # Marsh & McLennan US 6,101 5,290 - 401 11,792
37 # Broadcom US 7,203 801 - 3,620 11,624
38 29 Shin-Etsu Chemical Japan 10,628 - (2,251) 3,034 11,411
39 43 Safran France 9,490 - (1,524) 3,435 11,401
40 # Unicredit Italy 7,812 - - 3,379 11,191
41 # Taiwan Semiconductor Manufacturing Taiwan 8,214 - (1,094) 4,048 11,168
42 35 Honeywell US 9,925 1,035 - 143 11,103
43 30 Sanofi France 10,419 - - 669 11,088
44 # Samsung Electronics South Korea 6,752 6,613 (3,194) 820 10,991
45 44 SAP Germany 9,364 - (1,528) 2,949 10,785
46 42 Sumitomo Mitsui Japan 9,538 755 (1,091) 1,493 10,695
47 # IBM US 6,998 2,726 - 641 10,365
48 49 AbbVie US 9,136 - - 1,061 10,197
49 48 ADP US 9,158 298 - 694 10,150
50 # Siemens Denmark - 10,304 - (162) 10,142
598,365 160,195 (31,524) 100,111 827,147
All securities are equity investments
# Not in top 50 at 31 October 2023
Convertibles and all classes of equity in any one company are treated as one
investment
REVENUE GENERATED
30 April 2024 30 April 2023
£million £million
UK 4.4 4.7
Europe (ex UK) 3.5 3.1
North America 5.6 5.4
Japan 2.2 2.4
Pacific (ex Japan and China) 2.8 3.4
China 0.3 0.1
Emerging Markets 0.3 -
--------- ---------
19.1 19.1
===== =====
Source: Janus Henderson
GEOGRAPHICAL ANALYSIS Valuation of investments
Equities excluding cash held
30 April 2024 31 October 2023
% %
UK 13.9 15.1
Europe (ex UK) 17.1 16.7
North America 42.4 40.2
Japan 13.1 13.1
Pacific (ex Japan and China) 7.6 9.9
China 4.6 5.0
Emerging Markets 1.3 -
--------- ---------
100.0 100.0
===== =====
Source: Janus Henderson
SECTOR ANALYSIS
As a percentage of the investment portfolio excluding cash
30 April 2024 31 October 2023
% %
Technology 22.3 16.3
Financials 19.4 16.9
Consumer Discretionary 15.7 16.0
Industrials 14.4 17.2
Health Care 10.9 12.6
Consumer Staples 7.7 9.5
Energy 3.7 3.9
Basic Materials 3.3 2.8
Utilities 1.0 1.2
Telecommunications 0.9 2.5
Real Estate 0.7 1.1
--------- ---------
100.0 100.0
===== =====
Source: Janus Henderson
Neither the contents of the Company's website nor the contents of any website
accessible from hyperlinks on the Company's website (or any other website) are
incorporated into, or forms part of, this announcement.
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