REG - Henderson Opport Tst - Half-year Report

Henderson Opportunities TrustAnnouncement

18/06/2019 09:55

RNS Number : 6123C
Henderson Opportunities Trust PLC
18 June 2019
 


HENDERSON INVESTMENT FUNDS LIMITED
 
HENDERSON OPPORTUNITIES TRUST PLC
 
LEGAL ENTITY IDENTIFIER (LEI):  2138005D884NPGHFQS77
 
18 June 2019
 
 
HENDERSON OPPORTUNITIES TRUST PLC
Unaudited results for the half year ended 30 April 2019
 
This announcement contains regulated information.
 
Investment Objective
The Company aims to achieve capital growth in excess of the FTSE All-Share Index from a portfolio of UK investments.
 
Performance Highlights
 




 


(Unaudited)
30 April 2019


(Unaudited)
30 April 2018


(Audited)
 31 October 2018




Net Asset Value (NAV) per ordinary share


1,232.6p


1,246.7p


1,179.4p




Ordinary share price


1,007.5p


1,032.5p


990.0p




Net Assets


£97.4m


£99.8m


£94.4m




Discount


18.3%


17.2%


16.1%




Total return per ordinary share


64.5p


(9.1p)


(70.0p)




Revenue return per ordinary share - basic and diluted


13.4p


10.0p


20.2p




Dividends per ordinary share


7.0p


6.5p


21.0p




Net Gearing¹


14.0%


13.4%


6.7%




 
1 The net gearing percentage reflects the amount of borrowings (bank loans or overdrafts) the Company has used to invest in the market less cash and investment cash funds, divided by net assets multiplied by 100.
 
 




Total Return Performance to 30 April 2019
(including dividends reinvested and excluding transaction costs)




 


 
6 Months
%


 
1 Year
%


 
3 Years
%


 
5 Years
%




NAV per ordinary share1


5.6


0.4


32.8


42.5




Benchmark2


6.4


2.6


33.3


35.2




Share price3


3.3


-0.4


29.1


22.0




Sector average NAV4


4.7


0.0


24.8


37.1



 
 
 
 
 
 



 
Sources: Morningstar for the AIC, Datastream and Janus Henderson
 
1. Net Asset Value (NAV) total return per ordinary share with income reinvested
2. FTSE All-Share Index total return
3. Share price total return using mid-market closing price
4. Average NAV of the AIC UK All Companies Sector with income reinvested
 
 




For further information, please contact:
 


 


 




James Henderson
Fund Manager
Janus Henderson Investors
Telephone: 020 7818 4370


Laura Foll
Fund Manager
Janus Henderson Investors
Telephone: 020 7818 6364


 




 


 


 




Peter Jones
Chairman
Henderson Opportunities Trust plc
Telephone: 020 7818 4082


Laura Thomas
Investment Trust PR Manager
Janus Henderson Investors
Telephone: 020 7818 2636


 



 
 
 
 
 



 
INTERIM MANAGEMENT REPORT
 
CHAIRMAN'S STATEMENT
 
Performance
The NAV total return over the first six months of the financial year increased by 5.6%, while the FTSE All-Share total return increased by 6.4%. It was a period in which large companies outperformed smaller companies due to general economic concerns and uncertainty over Brexit. Over five years or more the Company has a strong record against the benchmark, as illustrated in the following table:
 




 


1 year
%


3 years
%


5 years
%


10 years
%




NAV (total return)


0.4


32.8


42.5


361.1




FTSE All-Share (total return)


2.6


33.3


35.2


167.9




Outperformance (+)/ Underperformance (-)


-2.2


-0.5


+7.3


+193.2




 
The share price remained on a discount to NAV moving from 16.1% to 18.3% over the period.
 
Gearing
During the period the Fund Managers used the general weakness in equity prices inspired by uncertainty over the economy to refresh the portfolio by adding four new stocks. The Company was a net buyer of equities and the gearing moved up to 14.0% from 6.7% at the start of the period.
 
Earnings and Dividend
The revenue return in the period was £1,061,000, compared with £797,000 in the corresponding period last year.  An interim dividend of 7.0 pence per ordinary share (2018: 6.5 pence) has been declared payable on 20 September 2019 to shareholders on the register of the Company on 16 August 2019.  A noticeable feature of the half year was the level of income achieved by stock lending. This was £224,000 over the period compared to £nil over the corresponding period last year and £49,000 for the year ended 31 October 2018. Stock lending is a closely monitored activity with a cap on the amount of stock that can be lent. The Board considers that it represents low risk to the portfolio and provides useful income.
 
Share Capital
Since the year end, 99,670 ordinary shares have been bought back, under the authority given by shareholders at the Company's Annual General Meeting, at an average price of 937p each. The shares are being held in treasury.  We purchased these shares in order to enhance NAV marginally, it did this by 0.2%, at a time when the underlying shares in the portfolio appeared particularly oversold.  We will continue to be opportunistic in our approach to buybacks with the objective of increasing the NAV rather than reducing the discount, although that may be a secondary consequence. The Board believes that the discount is more likely to be reduced over time by strong investment performance and the marketing of the strengths of the Company.
 
Outlook
The UK economy continues to grow but at a subdued pace. This is in spite of the macroeconomic uncertainties, in particular the fear that Brexit would be detrimental for UK economic growth. Some of this is priced into UK equity prices and accounts for the fall of Sterling and the underperformance of the UK markets since the referendum.  A continuation of open trade across borders with Europe would be positive. There are UK companies that are trading on reasonable valuations and yet have strong growth prospects because of dynamic management teams, and such companies remain the focus of the portfolio.
 
Peter Jones
Chairman
18 June 2019
 
 


FUND MANAGERS' REPORT
 
Review
The net asset value of the portfolio grew 5.6% in the six months to the end of April, while the benchmark FTSE All-Share rose 6.4% (both on a total return basis). 
 
It was a difficult period for AIM which, having had a strong start to 2018, fell materially in the fourth quarter (-21.5%) before recovering and finishing virtually unchanged over the six months. As at the end of April, 58% of the portfolio is invested on AIM. While it is disappointing to be underperforming our benchmark the FTSE All-Share over the period, part of what we are trying to achieve is providing exposure to high growth companies on AIM but without the heightened volatility that was particularly evident in the fourth quarter. In this context we are pleased to have outperformed the AIM All-Share Index and continue to see excellent value in the underlying portfolio.
 
Portfolio Attribution
The largest contributor to performance over the six months was RWS Holdings, which provides specialist translation services for sectors such as pharmaceuticals. As it is one of the largest companies in the markets that it operates in, it has a significant scale advantage. For this reason it generates consistently good operating margins and is also generating double digit organic growth. While it has performed well and now trades on a higher valuation, we are happy to maintain the current position and it sits within the 'compounders' sleeve of excellent quality companies within the portfolio.
 
The largest detractor from performance was Zoo Digital, which provides dubbing and subtitling services for content producers such as Netflix and Disney. The key advantage of Zoo Digital versus traditional studios is that it allows freelance actors to record from home using Zoo's software. This provides content producers with quicker, but still good quality, translations that allow them to transmit content more quickly across the globe. The reason for the poor share price performance during the period was that legacy work that Zoo used to undertake in the DVD market has rolled over more steeply than expected. Their higher value dubbing work continues to grow well and their customer base is successfully expanding. The position was added to over the period as in our view the current valuation looks compelling and the investment thesis of substantially growing dubbing revenue has not changed.  As at 17 June 2019, the share price since the period end had recovered by 16.4%.
 
Portfolio Activity
Having brought the gearing down in summer last year we used the fourth quarter and beginning of 2019 to be net buyers and as a result the gearing rose back to 14.0%.  This net buying included adding to holdings that we had previously reduced earlier in 2018 having de-rated substantially. Examples of this included e-learning services provider Learning Technologies1 and Senior, an engineer of predominantly aerospace components (which was sold in entirety in early 2018 and subsequently repurchased).
 
The largest purchase during the period was RBS. This is a new holding in the portfolio, and as at the end of April was 1.1%. The legacy issues of RBS (such as PPI) are largely resolved, while the balance sheet has been significantly strengthened such that it has now material excess capital that we think is likely to be returned to shareholders via a series of special dividends and share buybacks.
 
The largest individual sale during the period was Faroe Petroleum, which received a cash offer at a significant premium to the undisturbed share price from DNO, a Norwegian oil & gas company. It is encouraging to see takeover interest returning in the UK market and another of the holdings, Dairy Crest, was taken over by a Canadian company who wished to gain access to some of their established brands, such as Cathedral City.
 
Outlook
Following a difficult fourth quarter of 2018, valuations particularly within AIM have been re-set and are now at what, in our view, are attractive levels. There is heightened political and macro-economic uncertainty but our focus as fund managers remains on finding relatively unknown but fast growing smaller companies and larger companies in the UK where sentiment has become overly pessimistic.
 
James Henderson and Laura Foll
Fund Managers              
18 June 2019
 
 
1 Data illustrating Learning Technologies' share price since first purchase is set out below
 




 


March
2017


June 2019


September 2017


December 2017


March 2018


June 2018


September 2018


December 2018


March 2019




Share Price


42.5p


45.5p


55.0p


68.0p


88.0p


112.0p


166.5p


69.4p


70.6p




 
(Reduced at 160p in September 2018 and added to at 76p in January 2019)
 
Source: Datastream
 
 
 
PRINCIPAL RISKS AND UNCERTAINTIES
 
The principal risks and uncertainties associated with the Company's business can be divided into the following main areas:
 
•           investment activity and strategy;
•           financial instruments and the management of risk;
•           operational;
•           accounting, legal and regulatory;
•           liquidity;
•           net gearing; and
•           failure of Janus Henderson.
 
Detailed information on these risks is given in the Strategic Report and in the Notes to the Financial Statements in the Company's Annual Report for the year to 31 October 2018.
 
In the view of the Board, these principal risks and uncertainties were unchanged over the last six months 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 confirm that, to the best of their knowledge:
 
(a)       the condensed financial statements for the half year ended 30 April 2019 have been prepared in accordance with "FRS 104 Interim Financial Reporting";
 
(b)       this report includes a fair review of the information required by the 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)       this report and the condensed financial statements include a fair review of the information required by the Disclosure Guidance and Transparency Rule 4.2.8R (disclosure of related party transactions and changes therein).
 
 
 
For and on behalf of the Board
Peter Jones
Chairman
18 June 2019
 
 
 
INVESTMENT PORTFOLIO at 30 April 2019
 




Company


Valuation
£'000


Portfolio %


 


  Company


Valuation
£'000


Portfolio %












Blue Prism¹




RWS¹




Serica Energy¹




Tracsis¹




Loopup¹




HSBC




Johnson Matthey




Boku¹




Rolls Royce




Rio Tinto




10 Largest




Keyword Studios¹




Prudential




Sigmaroc¹




Ricardo




Learning Technologies¹




Oxford Instruments




Eland Oil & Gas¹




Assura




Flowtech¹




Springfield Properties¹




20 Largest




Tarsus




Workspace




Aveva




SDL




Standard Chartered




XP Power




4D Pharma¹




Zoo Digital¹




Integrafin




The Gym Group




30 Largest




Next Fifteen Communications¹




Character¹




Cohort¹




Miton¹




Vodafone




Redde¹




Tribal¹




Royal Bank of Scotland




GB Group¹




Fastjet¹




40 Largest




Direct Line Insurance




Vertu Motors¹




IQGEO¹




Hollywood Bowl




Gateley¹




Ceres Power¹




Premier Oil




Horizon Discovery¹




Keystone Law¹




Franchise Brands¹




50 Largest




 






5,260




4,981




4,752




3,200




2,931




2,706




2,670




2,486




2,287




2,232




33,505




2,180




2,169




2,162




2,150




2,099




2,092




2,018




1,960




1,742




1,723




53,800




1,721




1,680




1,672




1,635




1,610




1,608




1,501




1,474




1,451




1,451




69,603




1,450




1,400




1,323




1,260




1,207




1,204




1,198




1,198




1,190




1,172




82,205




1,153




1,132




1,100




1,023




932




909




861




857




855




855




91,882




 






4.8




4.5




4.3




2.9




2.6




2.4




2.4




2.2




2.1




2.0




30.2




2.0




2.0




1.9




1.9




1.9




1.9




1.8




1.8




1.6




1.5




48.5




1.5




1.5




1.5




1.5




1.5




1.5




1.4




1.3




1.3




1.3




62.8




1.3




1.2




1.2




1.1




1.1




1.1




1.1




1.1




1.1




1.0




74.1




1.0




1.0




1.0




0.9




0.9




0.8




0.8




0.8




0.8




0.8




82.9




 


 






Redcentric¹




Mondi




IP Group




Senior




IDOX¹




Eurocell




Quixant¹




Creo Medical¹




Oxford Biodynamics¹




Findel




60 Largest




Lloyds Banking Group




IQE¹




BT Group




Van Elle¹




Ebiquity¹




Aggregated Micro Power¹




International Consolidated Airlines




Ilika¹




IG Group




Surface Transforms¹




70 Largest




21 Remaining (excluding cash and investments written down to zero)




Total




 
 
 






841




840




832




811




771




752




719




658




654




645




99,405




626




597




573




550




550




544




540




540




510




473




104,908




5,969




 
 
110,877




 






0.8




0.8




0.7




0.7




0.7




0.7




0.6




0.6




0.6




0.6




89.7




0.6




0.5




0.5




0.5




0.5




0.5




0.5




0.5




0.4




0.4




94.6




5.4




 
 
100.0




 





¹ Quoted on the Alternative Investment Market ('AIM')
 
We have one unlisted holding, Oxford Sciences Innovation, which was 0.4% of the portfolio as at the period end. 
 
 
 
Attribution Analysis to 30 April 2019
 
The table below sets out the top five contributors and top five detractors to NAV
 




Top Five Contributors          


Share Price
Return %


Contribution
to NAV %




RWS


+28.0


+1.0




Serica Energy


+20.1


+1.0




Fastjet


+77.7


+0.6




Rio Tinto


+26.4


+0.5




Integrafin


+49.6


+0.5



 
 
 
 



 




Top Five Detractors    


Share Price
Return %


Contribution
to NAV %




Zoo Digital


-50.3


-0.8




Learning Technologies


-21.4


-0.6




Redde


-28.8


-0.5




The Gym Group


-22.3


-0.5




IQGEO


-27.6


-0.5




 
Source: Janus Henderson
 
Portfolio by Index at 30 April 2019
As a percentage of the investment portfolio excluding cash
 




Index


FTSE All-Share Index %


Portfolio
 %




FTSE 100


80.7


17.7




FTSE 250


15.7


9.0




FTSE SMALLCAP


3.6


11.3




FTSE FLEDGLING


0.0


0.4




FTSE AIM


0.0


58.1




OTHER


0.0


3.5




 


 


 




Total


100.0


100.0




 
Source: Factset
 
Portfolio by Market Capitalisation at 30 April 2019
As a percentage of the investment portfolio excluding cash
 




Index


FTSE All-Share Index %


Portfolio
%




Greater than £2bn


88.7


19.2




£1bn - £2bn


5.3


15.1




£500m - £1bn


3.3


10.5




£200m - £500m


2.3


20.4




£100m - £200m


0.4


17.6




£50m - £100m


0.0


7.8




Less than £50m


0.0


9.0




Other


0.0


0.4




 


 


 




Total


100.0


100.0




 
Source: Factset
 
 
 
CONDENSED INCOME STATEMENT
 




 


(Unaudited)
Half Year ended
30 April 2019


(Unaudited)
Half Year ended
30 April 2018


(Audited)
Year ended
31 October 2018




 


Revenue  return £'000


Capital return £'000


Total £'000


Revenue  return £'000


Capital return £'000


Total £'000


Revenue return £'000


Capital return £'000


Total £'000




Gains/(losses) from investments held at fair value through profit or loss                         


-


4,277


4,277


-


(1,256)


(1,256)


-


(6,669)


(6,669)




Investment income
held at fair value through
profit or loss         


1,095


-


1,095


1,058


-


1,058


2,097


-


2,097




Interest receivable
and other income               


228


-


228


9


-


9


74


-


74




Gross revenue and
capital gains/(losses)


1,323


4,277


5,600


1,067


(1,256)


(189)


2,171


(6,669)


(4,498)




 
Management fee (note 2)


(71)


(166)


(237)


(80)


(185)


(265)


(165)


(386)


(551)




Administrative expenses


(167)


-


(167)


(153)


-


(153)


(319)


-


(319)




 
Net return/(loss) before finance costs and taxation


1,085


4,111


5,196


834


(1,441)


(607)


1,687


(7,055)


(5,368)




Finance costs


(23)


(54)


(77)


(36)


(85)


(121)


(69)


(160)


(229)




 
Net return/(loss) before taxation  


1,062


4,057


5,119


798


(1,526)


(728)


1,618


(7,215)


(5,597)




Taxation on net return


(1)


-


(1)


(1)


-


(1)


(2)


-


(2)




 
Net return/(loss)  after taxation


1,061


4,057


5,118


797


(1,526)


(729)


1,616


(7,215)


(5,599)




 
Return/(loss) per ordinary share - basic and diluted (note 4)


13.36p


51.11p


64.47p


9.96p


(19.07p)


(9.11p)


20.20p


(90.18p)


(69.98p)




 
The total columns of this statement represent the Income Statement of the Company, prepared in accordance with FRS 104.
 
All revenue and capital items in the above statement derive from continuing operations. The revenue and capital return columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies. The Company had no recognised gains or losses other than those disclosed in the Income Statement and Statement of Changes in Equity. The accompanying notes are an integral part of the condensed financial statements.
 
 


CONDENSED STATEMENT OF CHANGES IN EQUITY
 




 


(Unaudited)
Half Year ended 30 April 2019




 


Called up share capital  £'000


 
Share premium account £'000


 
Capital redemption reserve £'000


 
 
Other capital reserves
£'000


 
 
Revenue reserve £'000


 
Total shareholders' funds
£'000




At 1 November 2018


2,000


14,838


2,431


72,334


2,757


94,360




Ordinary dividends paid


-


-


-


-


(1,146)


(1,146)




Net return after taxation


-


-


-


4,057


1,061


5,118




Buyback of ordinary shares into treasury


-


-


-


(939)


-


(939)




At 30 April 2019


2,000


14,838


2,431


75,452


2,672


97,393




 
 




 


(Unaudited)
Half Year ended 30 April 2018




 


Called up share capital  £'000


 
Share premium account
£'000


 
Capital redemption reserve
£'000


 
Other capital reserves
£'000


 
 
Revenue reserve £'000


 
Total shareholders' funds
£'000




At 1 November 2017


2,000


14,838


2,431


79,549


2,781


101,599




Ordinary dividends paid


-


-


-


-


(1,120)


(1,120)




Net (loss)/return after taxation


-


-


-


(1,526)


797


(729)




At 30 April 2018


2,000


14,838


2,431


78,023


2,458


99,750




 
 




 


(Audited)
Year ended 31 October 2018




 


Called up share capital  £'000


 
Share premium account
£'000


 
Capital redemption reserve
£'000


 
Other capital reserves  £'000


 
 
Revenue reserve £'000


 
Total shareholders' funds
£'000




At 1 November 2017


2,000


14,838


2,431


79,549


2,781


101,599




Ordinary dividends paid


-


-


-


-


(1,640)


(1,640)




Net (loss)/return after taxation


-


-


-


(7,215)


1,616


(5,599)




At 31 October 2018


2,000


14,838


2,431


72,334


2,757


94,360




 
 
The accompanying notes are an integral part of these condensed financial statements.
 
CONDENSED STATEMENT OF FINANCIAL POSITION
 




 


(Unaudited)
30 April 2019
£'000


(Unaudited)
30 April 2018
£'000


(Audited)
31 October 2018 £'000




Investments held at fair value through profit or loss


 


 


 




Listed at market value


44,347


44,665


35,971




Quoted on AIM at market value


66,130


68,137


65,319




Unlisted at market value


400


400


400




 


110,877


113,202


101,690




Current assets


 


 


 




Investments held at fair value through profit or loss


2


2


2




Debtors


579


254


147




Cash at bank and in hand


935


212


707




 


1,516


468


856




 


 


 


 




Creditors: amounts falling due within one year


 


 


 




Bank loans


(14,552)


(13,540)


(7,001)




Other creditors


(448)


(380)


(1,185)




 


 


 


 




Net current liabilities


(13,484)


(13,452)


(7,330)




 


 


 


 




Net assets


97,393


99,750


94,360




 


 


 


 




Capital and reserves


 


 


 




Called up share capital (note 6)


2,000


2,000


2,000




Share premium account


14,838


14,838


14,838




Capital redemption reserve


2,431


2,431


2,431




Other capital reserves


75,452


78,023


72,334




Revenue reserves


2,672


2,458


2,757




 


 


 


 




 
Total shareholders' funds


97,393


 
                      99,750


94,360




 


 


 


 




Net asset value per ordinary share - basic and diluted (note 7)


 
1,232.6p


 
1,246.7p


1,179.4p




 


 


 


 




 
The accompanying notes are an integral part of these condensed financial statements.
 
 
 
 
CONDENSED STATEMENT OF CASH FLOWS
 




 


(Unaudited)
Half Year ended
30 April 2019
£'000


(Unaudited)
Half Year ended
30 April 2018
£'000


(Audited)
Year ended
31 October 2018
£'000




Cash flows from operating activities


 


 


 




Net return/(loss) before taxation


5,119


(728)


(5,597)




Add back: finance costs


77


121


229




Add: (gains)/losses on investments held at fair value through profit or loss


(4,277)


1,256


6,669




Withholding tax on dividends deducted at source


(2)


(2)


(1)




(Increase)/decrease in debtors


(203)


(43)


62




Decrease in creditors


(34)


(918)


(899)




 


 


 


 




Net cash inflow/(outflow) from operating activities


680


(314)


463




 


 


 


 




Cash flows from investing activities


 


 


 




Purchase of investments


(15,115)


(13,304)


(30,932)




Sale of investments


9,268


15,021


39,550




Net cash (outflow)/inflow from investing activities


(5,847)


1,717


8,618




 


 


 


 




Cash flows from financing activities


 


 


 




Equity dividends paid (net of refund or unclaimed distributions and reclaimed distributions)


(1,146)


(1,120)


(1,640)




Buyback of ordinary shares into treasury


(939)


-


-




Net loans drawn down/(repaid)


7,551


(1,085)


(7,624)




Interest paid


(71)


(109)


(233)




Net cash inflow/(outflow) from financing activities


5,395


(2,314)


(9,497)




 


 


 


 




Net increase/(decrease) in cash and cash equivalents


228


(911)


(416)




 


 


 


 




Cash and cash equivalents at start of year


707


1,123


1,123




 


 


 


 




Cash and cash equivalents at end of period


935


212


707




 


 


 


 




 


 


 


 




Comprising:


 


 


 




Cash at bank


935


212


707




 


 


 


 




 
The accompanying notes are an integral part of these condensed financial statements.
 
 
 
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
 




1


Accounting policies - basis of preparation




 


The condensed set of financial statements has been prepared in accordance with FRS 104, Interim Financial Reporting, FRS 102, the Financial Reporting Standard applicable in the UK and Republic of Ireland, and the Statement of Recommended Practice for "Financial Statements of Investment Trust Companies and Venture Capital Trusts", which was updated by the Association of Investment Companies in February 2018 with consequential amendments.
 
For the period under review, the Company's accounting policies have not varied from those described in the annual report for the year ended 31 October 2018. These financial statements have been neither audited nor reviewed by the Company's auditors.
 




2


Expenses: management fees and performance fees




 


Henderson Investment Funds Limited ("HIFL") is appointed to act as the Company's Alternative Investment Fund Manager. HIFL delegates investment management services to Henderson Global Investors Limited. References to the Manager within these results refer to the services provided by both entities. The management fee is calculated, quarterly in arrears, as 0.55% per annum on the net assets. Arrangements are in place for the Manager to earn a performance fee. The cap on total fees that can be earned in a financial year is 1.5% of the average net assets over the year. There is no performance fee accrual for the current period (30 April 2018: and 31 October 2018: £nil). Since 1 November 2013, the Company has allocated 70% of its management fees and finance costs to the capital return of the Income Statement with the remaining 30% being allocated to the revenue return. Performance fees payable are allocated 100% to the capital return.
 




3


Dividends




 


The Board has declared an interim dividend of 7.0 p per ordinary share (2018: 6.5p), to be paid out of revenue  on 20 September 2019 to shareholders on the register of the Company at the close of business on 16 August 2019. The Company's shares will be quoted ex-dividend on 15 August 2019. Based on the number of ordinary shares in issue on 18 June 2019, the cost of this dividend will be £553,000.
 
No provision has been made for the interim dividend in these condensed financial statements. The final dividend of 14.5p per ordinary share, paid on 22 March 2019 in respect of the year ended 31 October 2018, has been recognised as a distribution in this period.
 




4


Return per ordinary share - basic and diluted




 


(Unaudited)
Half Year ended
30 April 2019
£'000


(Unaudited)
Half Year ended
30 April 2018
£'000


(Audited)
Year ended
31 October 2018
£'000




The return per ordinary share is based on the following figures:
 


 


 


 




Revenue return


1,061


797


1,616




Capital return/(loss)


4,057


(1,526)


(7,215)




Total return/(loss)


5,118


(729)


(5,599)




 


 


 


 




Weighted average number of ordinary shares in issue for the period


7,938,225


8,000,858


8,000,858




 


 


 


 




Revenue return per ordinary share


13.36p


9.96p


20.20p




Capital return/(loss)per ordinary share


51.11p


(19.07p)


(90.18p)




Total return/(loss)per ordinary share


64.47p


(9.11p)


(69.98p)




 


 
 




5


Investments held at fair value through profit or loss




 


The table below analyses fair value measurements for investments held at fair value through profit or loss. These fair value measurements are categorised into different levels in the fair value hierarchy based on the valuation techniques used and are defined as follows under FRS 102:                                        
Level 1: valued using quoted prices in active markets for identical assets                                       
Level 2: valued by reference to valuation techniques using observable inputs other than quoted prices included in Level 1                                                                              
Level 3: valued by reference to valuation techniques using inputs that are not based on observable market date
                       




Investments held at fair value through profit or loss at 30 April 2019 (unaudited)


Level 1
£'000


Level 2
£'000


Level 3
£'000


Total
£'000




Investments


110,477


-


400


110,877




Current asset investments


2


-


-


2




Total


110,479


-


400


110,879




 




Investments held at fair value through profit or loss at 30 April 2018 (unaudited)


Level 1
£'000


Level 2
£'000


Level 3
£'000


Total
£'000




Investments


112,802


-


400


113,202




Current asset investments


2


-


-


2




Total


112,804


-


400


113,204




 




Investments held at fair value through profit or loss at 31 October 2018 (audited)


Level 1
£'000


Level 2
£'000


Level 3
£'000


Total
£'000




Investments


101,290


-


400


101,690




Current asset investments


2


-


-


2




Total


101,292


-


400


101,692




 


 


 


 


 




 
There have been no transfers between levels of the fair value hierarchy during the period.
 
The valuation techniques used by the Company are explained in the accounting policies note in the Company's Annual Report for the year ended 31 October 2018.
 




6


Called up share capital




 


During the period ended 30 April 2019, 99,670 shares were repurchased to be held in treasury at a cost of £939,000 (half year ended 30 April 2018 and year ended 31 October 2018: no shares repurchased or issued).  At 30 April 2019 there were 8,000,858 ordinary shares of 25p each in issue (30 April 2018 and 31 October 2018: 8,000,858) of which 99,670 were held in treasury (30 April 2018 and 31 October 2018: no shares held in treasury) resulting in 7,901,188 shares being entitled to a dividend (30 April 2018 and 31 October 2018: 8,000,858). 
 




7


Net asset value per ordinary share - basic and diluted




 


Net asset value per ordinary share is based on the net assets attributable to the ordinary shares of £97,393,000 (30 April 2018: £99,750,000; 31 October 2018: £94,360,000) and on the 7,901,188 ordinary shares of 25p each in issue at 30 April 2019 (half year ended 30 April 2018: 8,000,858; year ended 31 October 2018: 8,000,858).
 




8


Transaction costs




 


Purchase transaction costs for the half-year ended 30 April 2019 were £43,000 (30 April 2018: £11,000; 31 October 2018: £40,000); these comprise mainly stamp duty and commissions. Sale transaction costs for the half-year ended 30 April 2019 were £4,000 (30 April 2018: £6,000; 31 October 2018: £18,000); these comprise mainly commissions.
 




9


Related party transactions




 


The Company's transactions with related parties in the period were with the Directors, and the Manager. There have been no material transactions between the Company and its Directors during the half year and the only amounts paid to them were in respect of expenses and remuneration for which there are no outstanding amounts payable at the half year period end.
 
In relation to the provision of services by the Manager, other than fees payable by the Company in the ordinary course of business and the facilitation of marketing activities with third parties, there have been no material transactions with the Manager affecting the financial position of the Company during the half year period.
 




10


Going concern




 


The Company's Articles of Association require that at the Annual General Meeting of the Company held in 2008, and every third year thereafter, an ordinary resolution be put to approve the continuation of the Company. The resolutions put to the Annual General Meetings in 2011, 2014 and in 2017 were duly passed. The next triennial continuation resolution will be put to the Annual General Meeting in 2020. The assets of the Company consist almost entirely of securities that are listed (or quoted on AIM) and are readily realisable. Accordingly, the Directors believe that the Company has adequate resources to continue in operational existence for at least twelve months from the date of approval of the financial statements. Having assessed these factors and the principal risks, the Directors considered it appropriate to adopt the going concern basis of accounting in preparing the financial statements. 
 




11


General information




 


Company Status:
Henderson Opportunities Trust plc is registered in England and Wales No. 01940906, has its registered office at 201 Bishopsgate, London EC2M 3AE and is listed on the London Stock Exchange.
 
SEDOL/ISIN: 0853657
London Stock Exchange (TIDM) Code: HOT
Global Intermediary Identification Number (GIIN): LVAHJH.99999.SL.826
Legal Entity Identifier (LEI): 2138005D884NPGHFQS77
 
Directors and Corporate Secretary:
The Directors of the Company are Peter Jones (Chairman), Frances Daley (Audit Committee Chairman), Chris Hills, Malcolm King and Wendy Colquhoun. The Corporate Secretary is Henderson Secretarial Services Limited, represented by Melanie Stoner, FCIS.
 
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.hendersonopportunitiestrust.com.
 




12


Comparative information




 


The financial information contained in the half-year report does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. The financial information for the half year periods ended 30 April 2019 and 30 April 2018 has not been audited or reviewed by the Company's auditors. The figures and financial information for the year ended 31 October 2018 are an extract based on the latest published accounts and do not constitute statutory accounts for that year. Those accounts have been delivered to the Registrar of Companies and included the report of the auditors, which was unqualified and did not contain a statement under either section 498(2) or 498(3) of the Companies Act 2006.
 




13


Half Year Report




 


The Half Year Report will be available in typed format on the Company's website, www.hendersonopportunitiestrust.com, or from the Company's registered office, 201 Bishopsgate, London EC2M 3AE. An abbreviated version, the 'Update', will be circulated to shareholders in June.



 
 
 
 
 



 
 
Neither the contents of the Company's website not the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.




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