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MTH - Mithras Investment Trust News Story

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Last Trade - 11/09/18

Sector
Financials
Size
Micro Cap
Market Cap £n/a
Enterprise Value £n/a
Revenue £3.24m
Position in Universe th / 1808

Mithras Inv.Trst PLC - Half-year Report - Part 2

Wed 26th July, 2017 5:03pm
- Part 2: For the preceding part double click  ID:nRSZ2037Ma 

accordance with
International Private Equity and Venture Capital Guidelines and is based upon
the NAV's of the five Underlying Funds in which MCF has invested. As a
starting point, MCF's provisional valuation is based upon the sum of its pro
rata share of each of the Underlying Fund's NAV. The Underlying Funds NAV's
are themselves derived from the fair value of the 31 portfolio companies held
by MCF and are computed by the Underlying Fund investment managers using the
most appropriate valuation technique for each individual portfolio company. 
 
The Board then considers whether this MCF NAV requires further adjustment. The
Investment Manager prepares a valuation paper at the interim and year end
reporting date. This valuation paper considers the valuation processes and
techniques of each Underlying Fund investment manager and also the specific
valuation methodology of the ten largest investments. This review also
considers market conditions and any subsequent investments or realisations
post balance sheet. The principal regular adjustment to the provisional MCF
NAV is in respect of non co-terminous reporting periods. There is usually a
significant delay in the receipt of Underlying Fund reporting and where this
is the case, the Investment Manager will seek indications from Underlying Fund
investment managers as to the expected valuation movements between the latest
available Underlying Fund NAV and the reporting date. The Board then reviews
the valuation paper along with any proposed adjustments in respect of non
co-terminus reporting periods and these amounts are aggregated to represent a
fair value adjustment to the MCF provisional NAV. These represent the
Directors' revaluation adjustment. As at 30 June 2017, this represents 3% of
the Limited Partnership fair value balance and therefore the Directors'
believe that this is not so significant as to warrant further disclosure other
than as outlined above. The Investment Manager has visibility over the
valuation methodology for over 99% of the underlying portfolio companies in
terms of their fair value and the value they contribute to the MCF NAV. 
 
MCF has a carried interest scheme where carried interest of 10% could become
payable once MCF has returned all capital contributed by LPs in addition to
exceeding a net MCF IRR of 8%. As at 30 June 2017, MCF has a net MCF IRR in
excess of 8% and therefore a provision has been made by MCF within its
valuation for carried interest. The Company's share of this carried interest
provision is £3.0 million. 
 
Given the number of underlying investments, the Directors have not presented a
sensitivity analysis at an individual input level for these investments as
they do not deem it to be material. The Investment Manager does not prepare an
aggregated input sensitivity analysis at a private equity fund level for all
of MCF's underlying fund investments or at the limited partnership level. This
is because the Company has a diversified mature investment portfolio and a
change in the estimate of one input on an individual portfolio company would
not be significant in terms of the overall valuation of MCF. While the
portfolio companies are concentrated in certain sectors, these portfolio
companies within the sectors are located in different countries. Furthermore,
the valuation methodology for the portfolio companies has been consistent over
time. 
 
There were no transfers between levels for the six months ended 30 June 2017,
nor for the year ended 31 December 2016. 
 
10. Net Assets per Ordinary Share 
 
The basic total net assets per Ordinary share is based on the net assets
attributable to owners shown in the Balance Sheet as at 30 June 2017, and on
10,030,841 Ordinary shares, being the number of Ordinary shares in issue at 30
June 2017 (30 June 2016: 14,228,143; 31 December 2016: 14,228,143). 
 
There is no dilution effect and therefore no difference between the diluted
total net assets per Ordinary share and the basic total net assets per
Ordinary share stated above. 
 
11. Guarantees and Commitments 
 
(a) Guarantees 
 
The Company has agreed to provide such financial support to MIL as it may
require to continue trading as a going concern. 
 
(b) Commitments 
 
The Company has a maximum outstanding commitment of £3.2 million to MCF at 30
June 2017 (30 June 2016: £3.3 million; 31 December 2016: £3.5 million). This
will take the form of capital calls. 
 
12. Related Party Transactions and Disclosures 
 
The following note provides details of the Group and Company's related party
disclosures and related party transactions during the period: 
 
(a) Under the Investment Management Agreement, dated 27 March 2009, the
Company paid fees of £32,000 (30 June 2016: £32,000; 31 December 2016:
£64,000) to MCP, of which £16,000 was outstanding at 30 June 2017 (30 June
2016: £16,000; 31 December 2016: £16,000). 
 
(b) Legal & General Assurance Society Limited held 31.51% of the Ordinary
share capital of the Company as at 30 June 2017 (30 June 2016: 32.92%; 31
December 2016: 32.92%). 
 
(c) Mr Boylan, the Managing Partner and Designated Member of MCP, in his
personal capacity held 0.40% (30 June 2016: 0.39%; 31 December 2016: 0.39%) of
the Ordinary share capital of the Company as at 30 June 2017. Mr Boylan is a
member of MCP and has a profit entitlement of 15% of the profits in MCP (30
June 2016: 15%; 31 December 2016: 15%). 
 
(d) Under a Retention Arrangement dated 5 November 2014, Mr Boylan will become
entitled, on completion of the realisation strategy, to a sum of £200,000 in
consideration for acquiring his 15% minority interest in MCP (referred to as
the Non-controlling Interest within the Consolidated Financial Statements).
The circumstances that will give rise to the completion of the realisation
strategy could vary depending upon the choice of exit route taken by the
Company and the arrangement is subject to good leaver provisions. 
 
(e) The compensation payable to key management personnel (which includes
members of MCP but excludes Directors of the Company) amounted to £75,000 (30
June 2016: £75,000; 31 December 2016: £149,000) paid as guaranteed drawings.
Profit share distributed to the Non-controlling Interests (members of MCP)
amounted to £18,000 (30 June 2016: £18,000; 31 December 2016: £34,000). 
 
(f ) The Company invests in MCF, which is managed by MCP. A carried interest
scheme operates for the benefit of the founder partners in the scheme. The
founder partners are Ms Gillian Brown, Mr Adrian Johnson and Mr Boylan.
Carried interest of 10% of investment profits could become payable once MCF
has returned all capital contributed by investors as well as exceeding a net
IRR of 8% per annum. As at 30 June 2017, MCF's net fund IRR was 8.6% and a
provision of £3.0 million was made against the valuation of MCF. No carried
interest payments were made during the period or have been since the inception
of MCF. 
 
Statement of Directors' Responsibilities 
 
In respect of the Interim Report and Financial Statements for the six months
ended 30 June 2017, we confirm that to the best of our knowledge: 
 
• The Interim Report and Financial Statements have been prepared in accordance
with International Accounting Standard 34, 'Interim Financial Reporting'
issued by the International Accounting Standards Board, as adopted by the EU
and give a true and fair view of the assets, liabilities, financial position
and profit of the Company as required by DTR 4.2.4R of the Disclosure Guidance
and Transparency Rules; 
 
• The Investment Manager's Review includes a true and fair review of the
information required by DTR 4.2.7R of the Disclosure Guidance and Transparency
Rules, being an indication of the important events that have occurred during
the first six months of the financial year and their impact on the Interim
Report and Financial Statements; 
 
• In accordance with DTR 4.2.8R of the Disclosure Guidance and Transparency
Rules and as disclosed in note 12 above, there have been no changes in the
nature or magnitude of the related party transactions that have taken place in
the first six months of the current financial year and, therefore, there is
nothing to report on any material effect by such a transaction on the
financial position or the performance of the Company during the period; and 
 
• In accordance with DTR 4.2.7R of the Disclosure Guidance and Transparency
Rules, the description of the principal risks and uncertainties as disclosed
in the Investment Manager's Review is a fair review of the information
required under DTR 4.2.7R for the remaining six months of the year. 
 
On behalf of the Board 
 
Mithras Investment Trust plc 
 
Company Number: 2478424 
 
William Maltby 
 
Chairman 
 
26 July 2017 
 
Interim Report and Financial Statements 
 
The Company's Interim Report and Financial Statements for the six months ended
30 June 2017 will be posted to shareholders in August 2017. Copies of the
Interim Report and Financial Statements will be available from the Registered
Office of the Company at 10 Harewood Avenue, London NW1 6AA and on the
website, www.mithrasinvestmenttrust.com, which is a website maintained by the
Company's Investment Manager, MCP. A copy of the Interim Report and Financial
Statements for the six months ended 30 June 2017 has been submitted to the
National Storage Mechanism of the UK Listing Authority and will shortly be
available for inspection at: www.Hemscott.com/nsm.do. 
 
For further information, please contact: 
 
Susan Gledhill 
 
Company Secretary 
 
For and on behalf of 
 
BNP Paribas Secretarial Services Limited 
 
Tel: 020 7410 5971 
 
26 July 2017 
 
This information is provided by RNS
The company news service from the London Stock Exchange
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