REG-Miton Global Opp Plc: Half-year Report
16/12/2019 10:30
Miton Global Opportunities plc
Half-Yearly Report for the six months ended 31 October 2019
Miton Global Opportunities plc (the “Company”) has today released its
Half-Yearly Report for the six months ended 31 October 2019.
The Half-Yearly Report and other information will be available via
www.premiermiton.com/migo
A copy of the Half Yearly Report will also be submitted to the National
Storage Mechanism and will shortly be available for inspection at
http://www.morningstar.co.uk/uk/NSM
Enquiries:
Miton Trust Managers Limited
Neil Birrell
DDI: +44 (0) 1483 400 486
Email: neil.birrell@premiermiton.com
Frostrow Capital LLP
Company Secretary
DDI: +44 (0)203 709 8732
Email: info@frostrow.com
Financial Highlights
31 October 2019 30 April 2019
Net asset value per share 272.2p 275.6p
Share price 264.0p 276.5p
(Discount) / Premium (3.0)% 0.3%
Net asset value volatility over one year (1) 5.1% 5.6%
Ongoing charges (2) 1.3% 1.4%
1 Source: Frostrow/ Morningstar
2 Source: Frostrow
*See Glossary later in the document.
Total Return Performance to 31 October 2019
6 months % 1 year % 5 years %
Net asset value (1.2) 0.7 60.3
Share price (4.5) (2.7) 74.8
3-month SONIA +2% 1.4 2.7 13.0
Source: Morningstar
Investment Objective
The objective of the Company is to outperform 3-month SONIA plus 2% (the
Benchmark) over the longer term, principally through exploiting inefficiencies
in the pricing of closed-end funds. This objective is intended to reflect the
Company’s aim of providing a better return to shareholders over the longer
term than they would get by placing money on deposit.
The Benchmark is a target only and should not be treated as a guarantee of the
performance of the Company or its portfolio.
Investment Policy
The Company invests in closed-end investment funds traded on the London Stock
Exchange’s Main Market but has the flexibility to invest in investment funds
listed or dealt on other recognised stock exchanges, in unlisted closed-end
funds (including, but not limited to, funds traded on AIM) and in open-ended
investment funds. The funds in which the Company invests may include all types
of investment trusts, companies and funds established onshore or offshore. The
Company has the flexibility to invest in any class of security issued by
investment funds including, without limitation, equity, debt, warrants or
other convertible securities. In addition, the Company may invest in other
securities, such as non-investment fund debt, if deemed to be appropriate to
produce the desired returns to shareholders.
The Company is unrestricted in the number of funds it holds. However, at the
time of acquisition, no investment will have an aggregated value totalling
more than 15% of the gross assets of the Company. Furthermore, the Company
will not invest more than 10%, in aggregate, of the value of its gross assets
at the time of acquisition in other listed closed-end investment funds,
although this restriction does not apply to investments in any such funds
which themselves have stated investment policies to invest no more than 15% of
their gross assets in other listed closed-end investment funds. In addition,
the Company will not invest more than 25%, in aggregate, of the value of its
gross assets at the time of acquisition in open-ended funds.
There are no prescriptive limits on allocation of assets in terms of asset
class or geography.
There are no limits imposed on the size of hedging contracts, save that their
aggregated value will not exceed 20% of the portfolio’s gross assets at the
time they are entered into.
The Board permits borrowings of up to 20% of the Company’s net asset value
(measured at the time new borrowings are incurred).
The Company’s investment objective may lead, on occasions, to a significant
amount of cash or near cash being held.
Chairman’s Statement
I am pleased to present the report on your Company’s activities during the
six months to 31 October 2019.
Performance
Over the six months to 31 October 2019 the Company’s net asset value per
share total return was -1.2% and the share price total return was -4.5%. These
returns compare to the return from the Company’s Benchmark, sterling 3-month
SONIA +2%, which delivered a total return of 1.4%.
A comprehensive review of the factors affecting the Company’s performance
during the period can be found in the Investment Managers’ Review later in
this report.
Share Price, Share Issuances and Buybacks
The share price reduced over the period from 276.5p to 264.0p, the shares
traded at a discount to net asset value per share of 3.0% at the end of the
period.
Demand for the Company’ shares at the beginning of the period led to the
issue of 150,000 new ordinary shares at a premium to net asset value. Not too
long after that share issuance, however, the Company’s shares started
trading at a discount to net asset value. In order to keep the discount under
control, the Company undertook a buyback of 100,000 shares at a price of 265.5
pence per share and a discount of 4.15% on 17 July 2019. As at 31 October
2019, the Company had 28,054,985 (30 April 2019: 28,004,985) shares in
issue. Since the period-end, the Company bought back a further 100,000
shares at a price of 265.0 pence per share and a discount of 2.6% on 14
November 2019, leaving 27,954,985 shares in issue.
The Company will always be proactive in managing its share price premium or
discount. Issuing new shares at a premium to net asset value per share creates
value for existing shareholders and any share issuance also improves the
liquidity of the Company’s shares, controls the premium to net asset value
per share at which the shares trade and spreads the operating costs over a
larger capital base, reducing the ongoing charges ratio. On the other hand,
share buybacks effectively reduce the overhang of shares in the market and,
like share issuances, can correct imbalances of supply and demand. The Board
and the Investment Managers are in regular contact in order to be able to
react swiftly to any disproportionate premiums or discounts the Company’s
shares are trading at.
Communication with Shareholders
In order to produce cost savings, reduce the Company’s carbon footprint and
accelerate the provision of information to shareholders, the Board has decided
to offer shareholders the option of receiving all Company information
electronically going forward.
A letter offering this opportunity was sent to shareholders together with the
last annual report. Shareholders who elect to receive communications from the
Company in this way will be notified by post or, if you prefer, by email when
information such as annual reports, notices of shareholder meetings and other
documents are published on our website www.premiermiton.com/migo
Shareholders of course still have the right to request (at no extra charge)
hard copy versions of the documents or information sent or supplied to you by
means of the website.
Outlook
Our Investment Manager continues to be well positioned to take advantage of
opportunities as they arise, and well diversified to weather difficulties in
the sector. This continues to be recognised by our industry, the Company
having won in the “Flexible Investment” category at the Investment Week
Investment Company of the Year Awards 2018 and in the “Best Mixed Asset
Trust” category at the Money Observer Trust Awards 2019. Your Board believes
in the long-term proposition of the Company which is, among other things,
evidenced by the fact that all Directors own shares, having aligned their
interests with those of other shareholders.
Richard Davidson
Chairman
16 December 2019
Investment Manager’s Report for the period ended 31 October 2019
Performance
During the six months to 31 October 2019, our net asset value fell from 275.6p
to 272.2p. This represents a decline of 1.2%. In comparison, the FTSE 100
index was flat on a total return basis. Our shares closed at 264.0p on the
last day of October leaving our shares trading on a discount of 3.0%.
Sector Developments
Superficially it appears that our interim period was rather a quiet affair. In
practice there were some tumultuous events. Most notable was the implosion of
Woodford Investment Management which will reverberate around financial markets
for some time to come. In response to this episode, wealth managers and
institutions have become focused on the liquidity within their portfolios. In
practice, many funds have become illiquid by virtue of their large size, often
running to many billions. This has led to widespread selling of smaller
companies and investment trusts. This has triggered a widening of discounts
across our portfolio as managers attempt to demonstrate that they could manage
a run of redemptions in their funds. We estimate that the real time discount
of our largest twelve positions approaches 25%, a situation we have not seen
for several years. In the circumstances our net asset value, which is
calculated using the depressed market price rather than the value of its
underlying portfolio, has held up well during a difficult period for our
universe.
A more helpful development has been the broadening of markets. Until recently,
we have endured a momentum or nothing phase. A narrow range of defensive
growth stocks have driven the indices ever higher. Given that we articulate a
deep value special situations strategy, it would cause alarm had we chosen to
chase momentum. The breakdown of this phenomenon appears to have been
triggered by a reversal in bond yields. It is interesting to note that in last
year’s interim report, we commented that the yield on US ten-year treasuries
had risen to 3.2%. At the time of writing, they only offer 1.75%, having
fallen as far as 1.45% at one point. The steady decline in yields was key in
creating the momentum market.
The closed-end sector continues to evolve into a home for alternative asset
classes; this category now exceeds equity funds for the first time. It is
possible to create far more diversification using closed-end funds than their
open-ended peers as a far wider range of asset classes are available. This
partially explains the low correlation Miton Global Opportunities demonstrates
when measured against mainstream equity indices.
Contributors
Alpha Real Estate continued to perform strongly. Earlier in the year it
disposed of a data centre in Frankfurt and a residential project in Leeds.
Both transactions triggered significant uplifts in the net asset value. These
disposals have made Alpha’s portfolio far more liquid, which justifies the
trust trading at a narrower discount than in the past. In June, a tender offer
was made for up to 25% of the shares at 175p. Many shareholders accepted the
offer, boosting the value attributed to ongoing shareholders. Alpha shares
have continued to appreciate.
Baker Steel and Ecofin both benefited from investors’ flight to safe havens.
Falling bond yields made Ecofin’s portfolio of utility and infrastructure
companies attractive to income starved investors. In the case of Baker Steel
Resources, their 40% exposure to precious metals proved extremely helpful.
There are several exciting projects in Baker Steel’s portfolio that are
approaching commercialisation. This leaves us optimistic about the outlook for
this trust.
New Positions
After our successful due diligence trip to Vietnam, we initiated a position in
Vietnam Enterprise in order to increase our exposure to the country. Vietnam
has become a manufacturing hub in Asia as China has become a more expensive
location. Young demographics and a growing middle class will drive consumption
and services. Increasingly essential expenditure is coming down as a
percentage of income which again should drive the economy. Finally, Vietnam
is a beneficiary of the trade war between China and the US as many companies
have moved manufacturing capacity to Vietnam. This trend has accelerated post
international tensions. Despite good performance over the past few years,
Vietnamese trusts have continued to trade on wider discounts than would
normally be expected. This is partially because when they were launched some
years ago, vast sums were raised on the back of Vietnam’s popularity at the
time. Both the trusts we own are sufficiently large to be constituents in the
FTSE 250 index. This leaves supply rather larger than demand, leaving the
point where these are in equilibrium well below the current value of their
portfolio.
We also started a position in Oakley Capital. This trust had been on our
“avoid list” for many years due to corporate governance issues such as
issuing stock at a discount. More recently, the trust’s management has
evolved into a more professional operation; however the discount reflects
investors’ nervousness about past troubles.
Detractors
Political issues were the main cause of two of our biggest detractors over the
period: Phoenix Spree Deutschland and Macau Property Opportunities. In Macau,
sentiment has been poor due to the riots in Hong Kong and the US/China trade
war. Many of the casinos in Macau are owned by US companies and they have to
renew their licenses over the coming months. During our trip to the Far East
we were also able to visit Macau and were struck by the amount of investment
in the Greater Bay Area. We think it is unlikely that the Chinese would wish
to derail their plans for the area and so will be pragmatic in their dealings
with the US companies. The arrival of the new CEO in Macau towards the end of
the year should also help kick-start the economy as he is likely to bring
policy gifts from the mainland when he takes over. Unfortunately, it is
unlikely that the Chinese will loosen restrictions on taking currency out of
China until there is a resolution to the trade war. This will impede the
trust’s ability to sell some of its upmarket properties to mainland Chinese
investors.
In June the Berlin state government proposed a five-year rent freeze for the
city. This hit the share price of Phoenix Spree Deutschland as it led to
uncertainty. In practice, the rent freeze is likely to be deemed
unconstitutional as it is only the Senate that can control rent regulation
rather than the state government. Nevertheless, any decision could take up to
eighteen months to make its way through the slow process of the federal
constitutional court. This lengthy period will weigh on the share prices of
German property companies. Phoenix Spree, however, is able to pivot its
business model away from rental into splitting up properties and selling them
into the private market where the restrictions don’t apply. An announcement
that they had begun this process, as well as share buybacks, have led to some
recovery in the price.
The Indian market has struggled due to problems in the non-banking finance
sector. These companies have become the de facto lenders to small and medium
sized businesses. Their capacity to lend has been impaired post a number of
scandals which led to investors redeeming, reducing capital available for them
to lend. Once they pulled away from the market, these businesses struggled to
access financing. India Capital Growth, where the mandate focuses on small and
medium sized businesses, has been particularly hard hit by these developments.
We have been reducing our Indian position in light of these short-term
headwinds.
Outlook
Whilst it certainly does not feel like it at the moment, events at Woodford
Investment Management will, in the longer term, prove beneficial for both
Miton Global Opportunities and investment trusts in general. The debacle has
highlighted how valuable the protection from having to accommodate daily
inflows and outflows, that the closed-ended capital structure offers, has
been. There has been a general decline in trading liquidity. This makes it
increasingly difficult for investors to buy and sell larger lines of stock
making closed-end protection even more valuable to managers of investment
trusts in the future.
Historically whenever discounts in our portfolio have been at the wider end of
their range, this has proved a leading indicator of decent periods of progress
for our portfolio. These have often proved short and sharp as they did in 2016
and 2017. There continue to be vast quantities of noise generated by issues
such as Brexit and Trump’s trade war with China. This has contributed to the
widening discounts in smaller closed-end funds. Nevertheless, these funds
control assets which have a fundamental value. The catalyst for many of our
themes will be that the real world will buy the assets which have become
undervalued by the City for internal structural reasons. In many cases, we
will enjoy the benefit of the elimination of discounts at both portfolio and
trust level.
Nick Greenwood
Charlotte Cuthbertson
Miton Asset Management Limited
16 December 2019
Portfolio Valuation as at 31 October 2019
Valuation £’000 % of portfolio
Alpha Real Trust 5,173 6.7
Phoenix Spree Deutschland 4,778 6.2
Dunedin Enterprise Investment Trust † 4,463 5.8
Baker Steel Resources Trust 4,362 5.7
Artemis Alpha Trust 3,730 4.8
Real Estate Investors * 3,291 4.3
Henderson Opportunities Trust 2,982 3.9
Vinacapital Vietnam Opportunity Fund 2,963 3.8
India Capital Growth Fund 2,874 3.7
New Star Investment Trust 2,726 3.5
Top 10 Investments 37,342 48.4
EPE Special Opportunities * 2,442 3.2
Macau Property Opportunities Fund † 2,316 3.0
Atlantis Japan Growth Fund 2,250 2.9
Stenprop 2,101 2.7
CQS Natural Resources Growth and Income 2,082 2.7
Ecofin Global Utilities and Infrastructure Trust 1,625 2.1
Downing Strategic Micro-Cap Investment Trust 1,503 1.9
Life Settlement Assets 1,501 1.9
Merian Chrysalis Investment Company 1,473 1.9
Geiger Counter *^ 1,351 1.8
Top 20 Investments 55,986 72.5
The Biotech Growth Trust 1,278 1.7
Rights and Issues Investment Trust 1,277 1.7
Gresham House Strategic 1,220 1.6
Marwyn Value Investors 1,170 1.5
Third Point Offshore Investors 1,138 1.5
River & Mercantile UK Micro Cap Investment Company 1,132 1.5
Oakley Capital Investments 968 1.3
Duke Royalty 920 1.2
Georgia Capital 915 1.2
Renn Universal 828 1.1
Top 30 Investments 66,832 86.8
Dragon Capital - Vietnam Enterprise Investments 776 1.0
LMS Capital 658 0.9
Aseana Properties † 646 0.8
Temple Bar Investment Trust 460 0.6
Cambium Global Timberland *† 403 0.5
JPMorgan Indian Investment Trust 372 0.5
Terra Catalyst † (unquoted) 345 0.4
Better Capital 2009 † 279 0.4
Chelverton Growth Trust 243 0.3
Reconstruction Capital II *† 192 0.2
Origo Partners *†? 55 0.1
St Peter Port Capital *† 38 0.0
Auctus Growth 30 0.0
Global Resources Investment Trust 7 0.0
Total investments in the portfolio (excluding cash) 71,336 92.5
Cash 5,839 7.5
Total investments in the portfolio (excluding cash) 77,175 100.0
* AIM/NEX listed.
† In liquidation, in a process of realisation or has a fixed life.
^ Includes both ordinary and subscription share holdings.
? Includes both ordinary and convertible preference share holdings.
Capital Structure
As at the date of this report, the Company’s share capital comprises
27,954,985 Ordinary shares of 1p each with one vote per share. The
Company’s Articles of Association contain provisions enabling shareholders
to elect at three-year intervals for the realisation of all or part of their
shareholding (the “Realisation Opportunity”). At the discretion of the
Company, shareholders may request that all or part of the Ordinary shares they
hold be placed, repurchased, or purchased out of the proceeds of an issue of
new Ordinary shares, or purchased under a tender offer or by a market maker.
If realisation elections cannot be satisfied in their entirety through the
placing and/or repurchase mechanism, all remaining Elected shares shall be
converted into Realisation shares.
Also in the event that the Company does not make available to members an
opportunity to effect such a realisation at the appointed time, shareholders
may serve a realisation election requesting that all or part of their Ordinary
shares be converted into Realisation shares.
The portfolio would then be split into two separate and distinct pools pro
rata as between the Continuing Ordinary shares (the “Continuation Pool”)
and the Realisation shares (the “Realisation Pool”). The Continuation Pool
would be managed in accordance with the Company’s investment objective and
policy, while the assets comprising the Realisation Pool would be managed in
accordance with an orderly realisation programme with the aim of making
progressive returns of cash to holders of Realisation shares as soon as
practicable. The precise mechanism for any return of cash to holders of
Realisation shares would depend on the relevant factors prevailing at the time
and would be at the discretion of the Board. If the net asset value of the
Company’s Continuing Ordinary shares is more than £30 million, then the
Company would continue in operation.
In October 2018, the Company offered a Realisation Opportunity, giving
shareholders the option either to retain or to realise their investment in the
Company. Realisation elections were received in respect of 1.55% of shares
in issue at the time, and these shares were subsequently placed in the market
into ongoing demand. There are currently no Realisation shares in issue.
The next Realisation Opportunity will be offered to shareholders in 2021. The
Board intends to put forward tailored proposals in relation to each
Realisation Opportunity to ensure it can be delivered efficiently and in
accordance with the best interests of the Company, at the relevant point in
time.
Interim Management Report
Principal Risks and Uncertainties
A review of the half year and the outlook for the Company can be found in the
Chairman’s Statement and in the Investment Manager’s Review. The principal
risks and uncertainties facing the Company fall into the following broad
categories: investment risks (including market and discount risk; liquidity,
cash and foreign exchange risk; interest rate risk and macro risk), strategic
risks (including shareholder relations and share price performance risk; key
person risk and company duration risk) and operational risks (in particular
service provider risk). These risks were explained in detail on pages 14 to 17
in the annual report for the year ended 30 April 2019. The Company’s
principal risks and uncertainties have not changed materially since the date
of that report and are not expected to change materially for the remaining six
months of the Company’s financial year.
The Board acknowledges the continued uncertainty surrounding the UK’s
decision to leave the EU. While the Board does not consider that this decision
has significantly altered the risk profile of the Company, it acknowledges
that there has been a considerable level of currency volatility since the
decision was taken. The Company does not currently hedge its currency
exposure.
Related Parties Transactions
During the first six months of the current financial year, no transactions
with related parties have taken place which have materially affected the
financial position or the performance of the Company.
Going Concern
The Directors believe, having considered the Company’s investment objective,
risk management policies, capital management policies and procedures, the
nature of the portfolio and expenditure projections, that the Company has
adequate resources, an appropriate financial structure and suitable management
arrangements in place to continue in operational existence for the foreseeable
future and, more specifically, that there are no material uncertainties
pertaining to the Company that would prevent its ability to continue in such
operational existence for at least twelve months from the date of the approval
of this half year report. For these reasons, the Directors consider there is
reasonable evidence to continue to adopt the going concern basis in preparing
the Half-Yearly Report.
Directors Responsibility Statement
The Board of Directors confirms that, to the best of its knowledge:
1. the condensed set of financial statements contained within the Half-Yearly
Report has been prepared in accordance with Financial Reporting Standard 104
(Interim Financial Reporting); and
2. the interim management report includes a fair review of the information
required by: 1. DTR 4.2.7R of the Disclosure Guidance and Transparency Rules,
being an indication of important events that have occurred during the first
six months of the financial year and their impact on the condensed set of
financial statements; and a description of the principal risks and
uncertainties for the remaining six months of the year; and
2. DTR 4.2.8R of the Disclosure Guidance and Transparency Rules, being 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 performance of the entity during that period; and any changes in
the related party transactions described in the last annual report that could
do so.
The Half-Yearly Report has not been reviewed or audited by the Company’s
auditor.
For and on behalf of the Board
Richard Davidson
Chairman
16 December 2019
Condensed Income Statement
Six months to 31 October 2019 (Unaudited) Six months to 31 October 2018 (Unaudited) Year ended 30 April 2019 (Audited)
Note Revenue £’000 Capital £’000 Total £’000 Revenue £’000 Capital £’000 Total £’000 Revenue £’000 Capital £’000 Total £’000
(Loss) on investments - (1,130) (1,130)? - (1,583) (1,583) - (140) (140)
Exchange losses on capital items - - - - - - - (8) (8)
Income 4 709 - 709 647 - 647 1,237 - 1,237
Management fee (246) - (246) (253) - (253) (493) - (493)
Other expenses (258) - (258) (506) - (506) (789) - (789)
Return / (Loss) before finance costs and taxation 205 (1,130) (925) (112) (1,583) (1,695) (45) (148) (193)
Finance costs (25) - (25) (52) - (52) (95) - (95)
Return / (Loss) before taxation 180 (1,130) (950) (164) (1,583) (1,747) (140) (148) (288)
Taxation - - - - - - 12 - 12
Return / (Loss) after taxation 180 (1,130) (950) (152) (1,583) (1,735) (128) (148) (276)
Return / (Loss) per Ordinary share 0.6p (4.0p) (3.4p) (0.6p) (5.7p) (6.3p) (0.5p) (0.5p) (1.0p)
The revenue loss, capital and total returns per Ordinary share are based on
28,095,149 shares, being the weighted average number of Ordinary shares in
issue during the period (six months ended 31 October 2018: 27,551,046 and year
ended 30 April 2019: 27,776,150).
The Total column of this statement is the Income Statement of the Company. The
supplementary revenue and capital columns have been prepared in accordance
with guidance issued by the AIC.
All revenue and capital items in the above statement derive from continuing
operations. There are no recognised gains or losses other than those passing
through the Income Statement and therefore no Statement of Total Comprehensive
Income has been presented.
The notes form an integral part of these financial statements.
Condensed Statement of Changes in Equity
Share Capital£’000 Capital Redemption reserve £’000 Share Premium account £’000 Special reserve £’000 Capital reserve £’000 Revenue reserve £’000 Total £’000
Six months to 31 October 2019 (Unaudited)
At 30 April 2019 280 60 24,394 10,008 43,218 (789) 77,171
New issue of shares during the period 2 - 409 - - - 411
Purchase and cancellation of own shares during the period (1) 1 - (267) - - (267)
(Loss)/return for the period - - - - (1,130) 180 (950)
Balance at 31 October 2019 281 61 24,803 9,741 42,088 (609) 76,365
Six months to 31 October 2018 (Unaudited)
At 30 April 2018 272 60 22,139 10,008 43,366 (661) 75,184
New issue of shares during the period 8 - 2,255 - - - 2,263
Loss for the period - - - - (1,583) (152) (1,735)
Balance at 31 October 2018 280 60 24,394 10,008 41,783 (813) 75,712
Year ended 30 April 2019 (Audited)
At 30 April 2018 272 60 22,139 10,008 43,366 (661) 75,184
New issue of shares during the year 8 - 2,255 - - - 2,263
Loss for the year - - - - (148) (128) (276)
Balance at 30 April 2019 280 60 24,394 10,008 43,218 (789) 77,171
The notes form an integral part of these financial statements.
Condensed Statement of Financial Position
As at 31 October 2019 (Unaudited) £’000 As at 31 October 2018 (Unaudited) £’000 As at 30 April 2019 (Audited) £’000
Non-current assets
Investments 71,336 66,730 72,278
Current assets
Debtors 206 341 117
Cash 5,839 14,074 5,113
6,045 14,415 5,230
Creditors: amounts falling due within one year
Bank loan - (5,000) -
Other creditors (1,016) (476) (337)
(1,016) (5,476) (337)
Net current assets 5,029 8,939 4,893
Net assets 76,365 75,712 77,171
Share capital and reserves
Share capital 281 280 280
Capital redemption reserve 61 60 60
Share premium account 24,8033 24,394 24,394
Special reserve 9,741 10,008 10,008
Capital reserve 42,088 41,783 43,218
Revenue reserve (609) (813) (789)
Total shareholders’ funds 76,365 75,712 77,171
Net asset value per Ordinary share 272.2p 270.4p 275.6p
The net asset value per Ordinary share is based on 28,054,985 shares, being
the shares in issue as at 31 October 2019 (31 October 2018: 28,004,985 and 30
April 2019: 28,004,985).
The notes form an integral part of these financial statements.
Condensed Cash Flow Statement
Six months to 31 October 2019 (Unaudited) £’000 Six months to 31 October 2018 (Unaudited) £’000 Year ended 30 April 2019 (Audited) £’000
Net cash inflow from operating activities 115 244 146
Investing Activities
Purchases of investments (7,782) (8,526) (18,651)
Sales of investments 8,273 10,554 16,847
Net cash inflow/(outflow) from investing activities 491 2,028 (1,804)
Financing Activities
New issue of shares 411 2,263 2,263
Purchase of own shares (267) - -
Revolving Credit facility repaid - - (5,000)
Finance costs paid (24) ))) (52) (83)
Net cash inflow/(outflow) from financing activities 120 2,211 (2,820)
Increase/(decrease) in cash 726 4,483 (4,478)
Cash at beginning of period 5,113 9,591 9,591
Cash at end of period 5,839 14,074 5,113
The notes form an integral part of these financial statements.
Notes to the Condensed Interim Financial Statements
1.Accounting policies
These condensed financial statements have been prepared on a going concern
basis in accordance with the Disclosure Guidance and Transparency Rules of the
Financial Conduct Authority, FRS 104 ‘Interim Financial Reporting’, the
Statement of Recommended Practice ‘Financial Statements of Investment Trust
Companies and Venture Capital Trusts’ updated in February 2018 and using the
same accounting policies as set out in the Company’s Annual Report for the
year ended 30 April 2019.
2.Financial statements
The condensed financial statements contained in this interim financial report
do not constitute statutory accounts as defined in s434 of the Companies Act
2006. The financial information for the six months to 31 October 2019 has not
been audited or reviewed by the Company’s external auditors.
The information for the year ended 30 April 2019 has been extracted from the
latest published audited financial statements. Those statutory financial
statements have been filed with the Registrar of Companies and included the
report of the auditors, which was unqualified and did not contain a statement
under Sections 498(2) or (3) of the Companies Act 2006.
3.Going concern
After making enquiries, and having reviewed the investments, Statement of
Financial Position and projected income and expenditure for the next 12
months, the Directors have a reasonable expectation that the Company has
adequate resources to continue in operation for the foreseeable future. The
Directors have therefore adopted the going concern basis in preparing these
financial statements.
4.Income
Six months to 31 October 2019 £’000 Six months to 31 October 2018 £’000 Year ended 30 April 2019 £’000
Income from investments
UK dividend income 305 392 746
Overseas dividend income 261 205 371
Property dividend income 143 50 120
Total income 709 647 1,237
5.Fair value hierarchy
The methods of fair value measurement are classified into a hierarchy based on
reliability of the information used to determine the valuation.
Level 1 – Quoted prices in an active market.
Level 2 – Inputs other than quoted prices included within Level 1 that are observable (i.e. developed using market data), either directly or indirectly.
Level 3 – Inputs are unobservable (i.e. for which market data is unavailable)
The table below sets out the Company’s fair value hierarchy investments.
Level 1 £’000 Level 2 £’000 Level 3 £’000 Total £’000
As at 31 October 2019
Investments – Equities 70,001 - 1,365 71,366
Total 70,001 - 1,365 71,366
As at 31 October 2018
Investments – Equities 64,444 - 1,177 65,621
Investments – OEICs - 1,152 - 1,152
Total 64,444 1,152 1,177 66,773
As at 30 April 2019
Investments – Equities 71,153 - 1,125 72,278
Total 71,153 - 1,125 72,278
Glossary of Terms and Alternative Performance Measures (“APMs”)
.
Discount or Premium (APM)
A description of the difference between the share price and the net asset
value per share. The size of the discount or premium is calculated by
subtracting the share price from the net asset value per share and is usually
expressed as a percentage (%) of the net asset value per share. If the share
price is higher than the net asset value per share, the result is a premium.
If the share price is lower than the net asset value per share, the shares are
trading at a discount.
Net Asset Value (‘NAV’) Total Return (APM)
The NAV is shareholders’ funds expressed as an amount per individual share.
Shareholders’ funds are the total value of all the Company’s assets, at
current market value, having deducted all liabilities and prior charges at
their par value (or at their asset value).
Ongoing Charges (APM)
Ongoing charges are calculated by taking the Company’s annualised revenue
and capitalised expenses (excluding finance costs and certain non-recurring
items) expressed as a percentage of the average monthly net assets of the
Company during the year.
Six months to Six months to One year to
31 October 31 October 30 April
2019 2018 2019
£’000 £’000 £’000
Management fee 246 253 493
Other expenses 258 506 789
Total Expenses 504 759 1,282
Less non-recurring expenses - (227) (185)
Total Ongoing charges 504 532 1,097
Average net assets 76,619 76,604 75,800
Ongoing Charges (annualised) 1.3% 1.4% 1.4%
The ongoing charges percentage reflects the costs incurred directly by the
Company which are associated with the management of a static investment
portfolio. Consistent with AIC Guidance, the ongoing charges percentage
excludes non-recurring items. In addition, the NAV performance also includes
the costs incurred directly or indirectly in investments that are managed by
external fund managers. Many of these managers net these costs off within
their valuations, and therefore they form part of the Company’s investment
return, and it is not practical to calculate an ongoing charges percentage
from the information they provide.
Share Price Total Return (APM)
The combined effect of any dividends paid, together with the rise and fall in
the share price or NAV. Total return statistics enable the investor to make
performance comparisons between trusts with different dividend policies. Any
dividends (after tax) received by a shareholder are assumed to have been
reinvested in either additional shares of the trust at the time the shares go
ex-dividend (the share price total return) or in the assets of the trust at
its NAV per share (the NAV total return). As the Company does not currently
pay dividends the NAV and share price total return are calculated by taking
the increase in the NAV or share price during the relevant period and dividing
by the opening NAV or share price.
Volatility
Volatility is related to the degree to which NAV or prices differ from their
mean (the standard deviation). Volatility is calculated by taking the daily
NAV or closing prices over the relevant year and calculating the standard
deviation of those prices. The daily standard deviation is then multiplied by
an annualisation factor being the square root of the number of the trading
days in the year.
Shareholder Information
Share dealing
Shares can be traded through a stockbroker or other authorised intermediary.
The Company’s Ordinary shares are traded on the London Stock Exchange. The
Company’s shares are fully qualifying investments for Individual Savings
Accounts (“ISAs”).
Share register enquires
The register for the Ordinary shares is maintained by Link Asset Services. In
the event of queries regarding your holding, please contact the Registrar on
0871 664 0300 (calls cost 12p per minute plus network extras; lines are open
9.00am to 5.30pm, Monday to Friday) (from outside the UK: +44 371 664 0300,
calls will be charged at the applicable international rate) or email:
enquiries@linkgroup.co.uk. Changes of name and/or address must be notified in
writing to the Registrar: Shareholder Services, Link Asset Services, The
Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TU, or via the shareholder
portal at www.signalshares.com.
Share capital and net asset value information
SEDOL number 3436594
ISIN number GB0034365949
Bloomberg symbol MIGO
The Company releases its net asset value per Ordinary share to the London
Stock Exchange on a daily basis.
Website: www.premiermiton.com/migo
Share prices
The mid-market prices are quoted daily in the Financial Times under
‘Investment Companies’.
Annual and Half-Yearly Reports
Copies of the Annual and Half-Yearly Reports are available from the Company
Secretary and on the Company’s website.
Investment Manager: Miton Asset Management Limited
The Company’s Investment Manager is Miton Asset Management Limited, a wholly
owned subsidiary of Premier Miton Group plc, an asset management group
managing £11billion on behalf of clients (as at 31 October 2019). Product
strengths include UK equities, US equities, European and Global equities and a
wide range of multi-asset strategies.
Investor updates in the form of monthly factsheets are available from the
Company’s website, www.premiermiton.com/migo
Association of Investment Companies
The Company is a member of the Association of Investment Companies.
Directors and Advisers
Directors (all non-executive) Registrar
Richard Davidson (Chairman) Michael Phillips (Senior Independent Director) Katya Thomson (Audit Committee Chairman) Hugh van Cutsem Registered Office 6th Floor Paternoster House 65 St Paul's Churchyard London EC4M 8AB Link Asset Services The Registry 34 Beckenham Road Beckenham Kent BR3 4TU Tel (from UK): 0871 664 0300* Tel (from overseas) : +44 371 664 0300 Email: enquiries@linkgroup.co.uk Website: www.linkassetservices.com *Calls cost 12p per minute plus your phone
company’s access charge and may be recorded for training purposes. Calls outside the UK will be charged at the applicable international rate. Lines are open from 9.00 a.m. to 5.30 p.m. Monday to Friday excluding public holidays in England and Wales.
Company Secretary, Marketing & Administration Stockbroker and Financial Adviser
Frostrow Capital LLP 25 Southampton Buildings London WC2A 1AL Website: www.frostrow.com Email: info@frostrow.com Numis Securities Limited The London Stock Exchange Building 10 Paternoster Square London EC4M 7LT
Alternative Investment Fund Manager Depositary and Custodian
Miton Trust Managers Limited Paternoster House 65 St Paul’s Churchyard London EC4M 8AB The Bank of New York Mellon (International) Limited One Canada Square London E14 5AL
Investment Manager
Miton Asset Management Limited Paternoster House 65 St Paul’s Churchyard London EC4M 8AB Website: www.premiermiton.com
Independent Auditor
PricewaterhouseCoopers LLP 2 Glass Wharf Bristol BS2 0FR
Miton Global Opportunities plc An investment company as defined under Section 833 of the Companies Act 2006 Registered in England and Wales No.5020752
END
Neither the contents of the Company’s website nor the contents of any
website accessible from hyperlinks on this announcement (or any other website)
is incorporated into, or forms part of, this announcement.
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