REG-New Star Investment Trust PLC New Star Investment Trust PLC: Annual Results for the year ended 30th June 2022
11/10/2022 10:15
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New Star Investment Trust PLC (NSI)
New Star Investment Trust PLC: Annual Results for the year ended 30th June
2022
11-Oct-2022 / 10:10 GMT/BST
Dissemination of a Regulatory Announcement, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
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NEW STAR INVESTMENT TRUST PLC
This announcement constitutes regulated information.
UNAUDITED RESULTS
FOR THE YEAR ENDED 30TH JUNE 2022
New Star Investment Trust plc (the ‘Company’), whose objective is to
achieve long-term capital growth, announces its consolidated results for
the year ended 30th June 2022.
FINANCIAL HIGHLIGHTS
30th June 30th June %
2022 2021 Change
PERFORMANCE
Net assets (£ ‘000) 123,978 138,132 (10.3)
Net asset value per Ordinary share 174.56p 194.49p (10.3)
Mid-market price per Ordinary share 125.00p 134.00p (6.7)
Discount of price to net asset value 28.4% 31.1% n/a
Total Return* (9.53)% 22.16% n/a
IA Mixed Investment 40% - 85% Shares (total (7.12)% 17.48% n/a
return)
MSCI AC World Index (total return, sterling (3.73)% 25.10% n/a
adjusted)
MSCI UK Index (total return) 3.16% 17.46% n/a
1st July 2021 to 1st July 2020 to
30th June 2022 30th June 2021
Revenue return per Ordinary share 0.98p 0.61p
Capital return per share (19.51)p 34.93p
Return per Ordinary share (18.53)p 35.54p
TOTAL RETURN* (9.53)% 22.16%
PROPOSED DIVIDEND PER ORDINARY SHARE 1.40p 1.40p
* The total return figure for the Group represents the revenue and capital
return shown in the Consolidated Statement of Comprehensive Income divided
by the net asset value at the beginning of the period.
CHAIRMAN’S STATEMENT
PERFORMANCE
Your Company had a negative total return of 9.53% over the year to 30th
June 2022, leaving the net asset value (NAV) per ordinary share at
174.56p. By comparison, the Investment Association’s Mixed Investment
40-85% Shares Index fell 7.12%. The MSCI AC World Total Return Index fell
3.73% in sterling while the MSCI UK Total Return Index rose 3.16%. Over
the year, UK government bonds declined 14.27%. Further information is
provided in the investment manager’s report.
Your Company made a revenue profit for the year of £700,000 (2021:
£429,000).
GEARINGS AND DIVIDEND
Your Company has no borrowings. It ended the year under review with cash
representing 19.79% of its NAV and is likely to maintain a significant
cash position. In respect of the financial year to 30th June 2022, your
Directors recommend the payment of a dividend of 1.4p per share (2021:
1.4p).
DISCOUNT
During the year under review, your Company’s shares continued to trade at
a significant discount to their NAV. The Board keeps this issue under
review.
OUTLOOK
Investors may have to contend with challenging economic conditions over
the remainder of 2022 and early 2023. Weakening monetary trends within the
Group of Seven major industrial nations, intensifying housing market
weakness and falling long-term bond yields relative to short-term interest
rates suggest a period of weak or no economic growth extending into the
spring of 2023. Inflationary trends, however, were showing signs of
moderating over the early autumn, suggesting that a return to 1970s-style
price rises was unlikely.
NET ASSET VALUE
Your Company’s unaudited NAV at 30th September 2022 was 174.35p.
INVESTMENT MANAGER’S REPORT
MARKET REVIEW
Global equities and bonds fell 3.73% and 3.60% in sterling respectively
over the year to 30th June 2022 as rising inflation and interest rates
hurt economic growth. Global equities rose 7.86% in sterling in the first
half of the year under review as economies emerged from Covid-19 lockdowns
and rising inflation was largely dismissed as transitory. Central banks,
including the Federal Reserve, turned more hawkish around the New Year,
however, as inflation became entrenched. Global equities and bonds fell
10.74% and 3.99% in sterling respectively over the second half of the year
under review.
Russia’s invasion of Ukraine in February 2022 exacerbated the rise in
energy and materials prices caused by the synchronised recovery in global
demand following the end of Covid-19 lockdowns. The US is close to
self-sufficient in energy because it has exploited its shale gas reserves
whereas European governments have closed coal-fired and nuclear power
stations, leaving the region dependent on Russian gas. In the short term,
liquid natural gas can be purchased from the US but it will take time to
reduce dependence on Russia by accelerating the transfer to renewable
energy and by classifying some gas and nuclear developments as “green
investments”.
In July 2022, headline inflation rates in US, eurozone and UK were 8.5%,
8.9% and 10.1%, far above the central banks’ 2% targets. US inflation fell
from a 9.1% high in June and may have reached its cyclical peak but
inflation is likely to rise in Europe because of higher energy costs as a
result of Russian gas supply restrictions. Before the recent announcement
of energy subsidies, the Bank of England said UK inflation might exceed
13% in the fourth quarter of 2022 because of the planned Ofgem energy
price increase and other factors. Monetary policy tightened and in
September 2022, US and UK official interest rates were 3.00-3.25% and
2.25% respectively. In the eurozone, key policy interest rates rose by
half a percentage point in July as the European Central Bank abandoned
negative interest rates and by a further 0.75 points in September. UK
government bonds, sterling corporate bonds and sterling high-yield bonds
fell 14.27%, 14.54% and 11.78% respectively over the year as the widening
differential between shorter-dated US and UK interest rates led to
sterling weakness and UK economic prospects deteriorated. The pound fell
12.09% against the dollar over the year.
PORTFOLIO REVIEW
Your Company had a negative total return of 9.53% over the year under
review. By comparison, the Investment Association Mixed Investment 40-85%
Shares sector, a peer group of funds with a multi-asset approach to
investing and a typical investment in global equities in the 40-85% range,
fell 7.12%. The MSCI AC World Total Return Index fell 3.73% in sterling
over the year while the MSCI UK All Cap Total Return Index rose 3.16%. In
falling markets, your company benefited from a high allocation to sterling
cash and dollars. Investment in technology stocks and a relatively low
allocation to US equities and large-cap UK equities, however, hurt
performance.
In January 2022, following a shift towards tighter monetary policies by
some central banks, your Company increased cash by approximately £8
million through partial sales of Fundsmith, Crux European Special
Situations and Trojan Income and the outright disposal of Aberdeen
Standard European Income and Chelsea Managed Monthly Income.
Your Company also received a net £14.8 million from the sale of a
private-equity investment, Embark Group, to Lloyds Banking Group. As a
result of this disposal, your Company’s private-equity investments fell
from 12% of assets to 2% over the course of the year. Approximately £1
million was invested in Vietnam Enterprise Investments. In March, after
falls by US stocks in January and February, $5 million was invested in the
iShares Core S&P 500 exchange-traded fund (ETF).
Tighter monetary policy contributed to a rotation in market leadership in
favour of global value stocks, which gained 5.25% in sterling over the
year whereas growth stocks fell 12.77%. Growth stocks had made gains
during the initial phases of the Covid-19 pandemic because their future
cash flows were discounted less aggressively in an environment of
near-zero interest rates. Technology stocks had been particularly strong
because Covid lockdowns accelerated the adoption of new technologies,
fuelling demand for electronic goods and online services. US technology
stocks, however, retreated 7.45% in sterling over the year and Polar
Capital Technology did worse, falling 21.75% because its holdings in
smaller stocks tended to underperform larger peers.
The underperformance of growth stocks and technology companies in
particular also contributed to an 11.13% fall for Fundsmith Equity, whose
concentrated portfolio included Meta, the owner of Facebook, as well as
Intuit and Paypal. By contrast, Baillie Gifford Global Income Growth fell
2.75% as greater diversification and an income mandate proved defensive.
Equities in Europe excluding the UK lagged, falling 9.78% in sterling as
energy prices, particularly gas prices, rose after Russia’s invasion of
Ukraine. European policymakers are being forced to confront the
consequences of energy policies that have left the region dependent on
Russian gas. BlackRock Continental European Income fell 10.56% while Crux
European Special Situations, which has a growth bias and typically has
significant holdings in smaller companies, fell 15.27%.
UK equities rose against the trend because of the UK stockmarket’s bias
towards cyclical value sectors such as energy and mining. UK smaller
companies, however, underperformed because of their higher sensitivity to
domestic trends, falling 17.18%. Within your Company’s portfolio, Man GLG
Income, which has a value investment style, did best, rising 0.83%. By
contrast, Trojan Income, which typically invests in companies where the
earnings sensitivity is lower than the market, fell 6.94%. Chelverton UK
Equity Income and Aberforth Split Level Income, two small-company
specialists, fell 11.51% and 23.19% respectively. The weakness among UK
small companies was magnified in Aberforth Split Level Income’s fall
because of portfolio leverage resulting from the trust’s zero dividend
preference shares.
Equities in emerging markets and Asia excluding Japan fell 14.68% and
14.44% respectively in sterling over the year, with Chinese equities,
which account for the largest proportion of both indices, down 22.30%.
Chinese stocks fell because of weak growth resulting from the country’s
“zero-Covid” policy, which led to lockdowns in cities such as Shanghai, an
over-indebted property sector and increased political risk stemming from
state intervention in quoted companies in accordance with Beijing’s
“common prosperity” policy. Matthews Asia ex-Japan Dividend and Liontrust
Asia Income fell 9.93% and 8.65% respectively. The JP Morgan investments,
Emerging Markets Income Trust and Emerging Markets Income Fund, fell
13.86% and 5.48% respectively. The bias towards regional funds managed in
accordance with an income mandate proved defensive as low-yielding big
Chinese technology companies such as Tencent and Alibaba fell sharply
while higher-yielding stocks such as Taiwan Semiconductor Manufacturing
Company fell less.
Amongst single-country emerging market income investments, Stewart
Investors India Sustainability, which aims to buy companies with strong
business models and balance sheets, did best, up 9.31% while Indian
equities gained 8.70% in sterling. Vietnam Enterprise Investments fell
3.16%. Vietnamese equities are benefiting from monetary discipline, high
public sector spending and an expanding middle class. Some global
manufacturers have moved capacity from China to benefit from lower costs
and avoid Sino-US sanctions. Following Russia’s Ukraine invasion, the HSBC
Russia Capped exchange-traded fund suspended trading. Your Company has
taken a conservative approach and valued the investment at zero.
Your Company predominantly invests in equity funds and achieves
diversification through holding other assets including cash and
currencies, low-risk multi-asset funds, alternative funds and gold equity
funds. It has minimal exposure to bonds and no direct investment to UK
government bonds which have fallen sharply since your Company’s year-end,
forcing the Bank of England to intervene and buy UK government bonds to
stabilise the market. Your Company benefited from holding dollars, which
represented 12.5% of NAV at the year end, with sterling falling 12.09%
against the dollar over the year. Amongst its low-risk multi-asset
holdings, Trojan rose 1.47% while EF Brompton Global Conservative fell
6.54%. Aquilus Inflection, an alternative investment, fell 3.11%. Gold
rose 15.25% in sterling but gold equities fell 9.87% as margins came under
pressure from rising costs. BlackRock Gold & General, which invests in
gold producers, fell 10.36%.
OUTLOOK
In the early autumn of 2022, US inflation remained far above the Federal
Reserve 2% target but appeared to be close to its cyclical high, with
tighter monetary policies reducing demand and economic activity. In
Europe, inflation may rise further because of Russian gas supply
restrictions. The US economy was technically in recession following two
quarters of economic decline and some leading indicators implied that a
further contraction was likely. US 10-year government bond yields close to
3% may present a buying opportunity.
Equity valuations have fallen but earnings forecasts may be too high as
margins come under pressure from higher costs and the impact of rising
living costs on consumer spending. The longer-term prospects for equities
look positive overall, however, because some companies have the ability to
pass on higher inflation through higher prices and reward investors
through higher dividends. Equity income investments may outperform because
higher yields may support valuations. Your Company’s equity income
holdings also contribute to the ability to pay a dividend although
investment income has yet to regain pre-Covid-19 levels.
At the year-end, your Company held 19.79% of its NAV in sterling and
dollar cash. Your Company was cautiously positioned prior to Russia’s
Ukraine invasion and has taken advantage of weak markets to increase its
overall allocation to equities modestly. Further falls in equity markets
may present buying opportunities for longer-term investors.
SCHEDULE OF LARGEST HOLDINGS AT 30TH JUNE 2022
Market Purchases/ Market Market
value 30 (Sales) movement value 30
June 2021 June 2022 % of net
assets
£’000 £’000
£’000 £’000
Fundsmith Equity Fund 10,653 (1,000) (1,091) 8,562 6.91
Polar Capital Global 9,299 - (2,022) 7,277 5.87
Technology
Matthews Asia Ex Japan 5,839 - (681) 5,158 4.16
Fund
MI Chelverton UK Equity 5,387 - (806) 4,581 3.69
Income Fund
EF Brompton Global 4,766 - (312) 4,454 3.59
Conservative Fund
Aquilus Inflection Fund 4,378 - (136) 4,242 3.42
First State Indian 3,608 - 335 3,943 3.18
Subcontinent Fund
BlackRock Continental 4,431 - (515) 3,916 3.16
European Income Fund
Baillie Gifford Global 4,075 - (199) 3,876 3.13
Income Growth
iShares Core S&P 500 - 3,969 (141) 3,828 3.09
UCITS ETF
BlackRock Gold & General 4,195 - (485) 3,710 2.99
EF Brompton Global 3,726 - (365) 3,361 2.71
Equity Fund
EF Brompton Global 3,545 - (347) 3,198 2.58
Opportunities Fund
Aberforth Split Level 4,212 - (1,068) 3,144 2.54
Income Trust
EF Brompton Global 3,309 - (265) 3,044 2.45
Growth Fund
Vietnam Enterprise 2,109 992 (157) 2,944 2.37
Investments
Liontrust Asia Income 3,233 - (384) 2,849 2.30
Fund
MI Brompton UK Recovery 3,020 - (222) 2,798 2.26
Unit Trust
Lindsell Train Japanese 3,199 - (549) 2,650 2.14
Equity Fund
Man GLG UK Income Fund 2,584 - (116) 2,468 1.99
TM Crux European Special 5,903 (3,000) (443) 2,460 1.98
Situations Fund
EF Brompton Global 2,669 - (218) 2,451 1.98
Balanced Fund
Trojan Accumulation Fund 2,337 - 35 2,372 1.91
EF Brompton Global 2,354 - (210) 2,144 1.73
Income Fund
Embark Group 14,842 (14,764) ____- _ _78 __0.06
113,673 (13,803) (6,362) 89,528 72.19
Balance not held in 16,054 (1,286) (4,826) 9,942 8.02
investments above
Total investments 129,727 (15,089) (15,188) 99,450 80.21
(excluding cash)
The investment portfolio, excluding cash, can be further analysed as
follows:
£ ‘000
Investment funds 82,496
Investment companies and exchange traded funds 12,890
Unquoted investments, including loans of £1.6m 2,613
Other quoted investments 1,451
99,450
STRATEGIC REVIEW
The Strategic Review is designed to provide information primarily about
the Company’s business and results for the year ended 30th June 2022. The
Strategic Review should be read in conjunction with the Chairman’s
Statement and the Investment Manager’s Report, which provide a review of
the year’s investment activities of the Company and the outlook for the
future.
STATUS
The Company is an investment company under section 833 of the Companies
Act 2006. It is an Approved Company under the Investment Trust (Approved
Company) (Tax) Regulations 2011 (the ‘Regulations’) and conducts its
affairs in accordance with those Regulations so as to retain its status as
an investment trust and maintain exemption from liability to United
Kingdom capital gains tax.
The Company is a small registered Alternative Investment Fund Manager.
PURPOSE CULTURE AND VALUES
The Directors acknowledge the expectation under the UK Code on Corporate
Governance issued by the Financial Reporting Council in July 2018 (the
‘Code’) that they formally define a purpose for the Company. The
Directors have reviewed this requirement and consider that the Company’s
purpose is to deliver the Company’s stated investment objective to achieve
long-term capital growth for the benefit of its investors.
Similarly, the Directors have also considered the Company’s culture and
values in line with the Code requirements. The Board has formed the view
that as the Company has no direct employees, and with operational
management outsourced to the Investment Manager, the Administrator and the
Company Secretary, the Company’s culture and values have to be those of
the Board. Having a stable composition and established working practices,
the Board is defined by experienced membership, trust and robust
investment challenge. These are therefore the key characteristics of the
Company’s culture and values.
STAKEHOLDER RESPONSIBILITIES (S.172 STATEMENT UNDER COMPANIES ACT 2006)
The Directors are aware of their responsibilities to stakeholders under
both the Code and legislation through regular governance updates from the
Company Secretary. As a UK listed investment trust, the Directors
outsource operational management of the Company, including day-to-day
management of the investment portfolio, to third parties. As a
consequence, the Directors consider their key stakeholder groups to be
limited to the Company’s shareholders, its third party advisers and
service providers, and individual Board members.
The Company’s Articles of Association, the Board’s commitment to follow
the principles of the Code and the involvement of the independent Company
Secretary in Board matters enable the Directors to meet their
responsibilities towards individual shareholder groups and Board members.
Governance procedures are in place which allow both investors and
Directors to ask questions or raise concerns appropriately. The Board is
satisfied that those governance procedures mean the Company can act fairly
between individual shareholders and takes account of Mr Duffield’s
significant shareholding. In considering the payment of the minimum
dividend required to maintain investment trust tax status, the
recommendations to vote in favour of the resolutions at the AGM and the
asset allocation within the investment portfolio, the Board assessed the
potential benefits to shareholders and the manager of the investment
portfolio.
The Board also regularly considers the performance of its independent
third party service providers. Those third party service providers in turn
have regular opportunities to report on matters meriting the attention of
the Board, including in relation to their own performance. The Board is
therefore confident that its responsibilities to each of its key
stakeholder groups are being discharged effectively.
As the Company does not have any employees, the Board does not consider it
necessary to establish means for employee engagement with the Board as
required by the latest version of the Code.
INVESTMENT OBJECTIVE AND POLICY
Investment Objective
The Company’s investment objective is to achieve long-term capital growth.
Investment Policy
The Company’s investment policy is to allocate assets to global investment
opportunities through investment in equity, bond, commodity, real estate,
currency and other markets. The Company’s assets may have significant
weightings to any one asset class or market, including cash.
The Company will invest in pooled investment vehicles, exchange traded
funds, futures, options, limited partnerships and direct investments in
relevant markets. The Company may invest up to 15% of its net assets in
direct investments in relevant markets.
The Company will not follow any index with reference to asset classes,
countries, sectors or stocks. Aggregate asset class exposure to any one of
the United States, the United Kingdom, Europe ex UK, Asia ex Japan, Japan
or Emerging Markets and to any individual industry sector will be limited
to 50% of the Company’s net assets, such values being assessed at the time
of investment and for funds by reference to their published investment
policy or, where appropriate, the underlying investment exposure.
The Company may invest up to 20% of its net assets in unlisted securities
(excluding unquoted pooled investment vehicles), such values being
assessed at the time of investment.
The Company will not invest more than 15% of its net assets in any single
investment, such values being assessed at the time of investment.
Derivative instruments and forward foreign exchange contracts may be used
for the purposes of efficient portfolio management and currency hedging.
Derivatives may also be used outside of efficient portfolio management to
meet the Company’s investment objective. The Company may take outright
short positions in relation to up to 30% of its net assets, with a limit
on short sales of individual stocks of up to 5% of its net assets, such
values being assessed at the time of investment.
The Company may borrow up to 30% of net assets for short-term funding or
long-term investment purposes.
No more than 10%, in aggregate, of the value of the Company’s total assets
may be invested in other closed-ended investment funds except where such
funds have themselves published investment policies to invest no more than
15% of their total assets in other listed closed-ended investment funds.
Information on the Company’s portfolio of assets with a view to spreading
investment risk in accordance with its investment policy is set out above.
FINANCIAL REVIEW
Net assets at 30th June 2022 amounted to £123,978,000 compared with
£138,132,000 at 30th June 2021. In the year under review, the NAV per
Ordinary share decreased by 10.25% from 194.49p to 174.56p, after paying a
dividend of 1.40p per share.
The Group’s gross revenue rose to £1,857,000 (2021: £1,522,000),
recovering from the worst impact of the Covid-19 pandemic. After deducting
expenses and taxation, the revenue profit for the year was £700,000 (2021:
£429,000).
Total expenses for the year rose to £1,157,000 after an increased
management fee (2021: £1,093,000). In the year under review the investment
management fee increased to £837,000 (2021: £774,000), reflecting the
Company’s increased average NAV over the period. Further details on the
Company’s expenses may be found in notes 3 and 4.
Historically, dividends have not formed a central part of the Company’s
investment objective. The increased investment in income focused funds
over the last few years has enabled the Directors to declare an increased
dividend in recent years. The pandemic’s adverse impact on dividends
received is seen as temporary, and the Directors have decided to utilise
retained earnings to maintain the dividend. The Directors propose a final
dividend of 1.40p per Ordinary share in respect of the year ended 30th
June 2022 (2021: 1.40p). If approved at the Annual General Meeting, the
dividend will be paid on 30th November 2022 to shareholders on the
register at the close of business on 4th November 2022 (ex-dividend 3rd
November 2022).
The primary source of the Company’s funding is shareholder funds.
While the future performance of the Company is dependent, to a large
degree, on the performance of international financial markets, which in
turn are subject to many external factors, the Board’s intention is that
the Company will continue to pursue its stated investment objective in
accordance with the strategy outlined above. Further comments on the
short-term outlook for the Company are set out in the Chairman’s Statement
and the Investment Manager’s report.
PERFORMANCE MEASUREMENT AND KEY PERFORMANCE INDICATORS
Throughout the year the Group’s investments included seven funds managed
by the Investment Manager (2021: seven). No investment management fees
were payable directly by the Company in respect of these investments.
In order to measure the success of the Company in meeting its objectives,
and to evaluate the performance of the Investment Manager, the Directors
review at each meeting: net asset value, income and expenditure, asset
allocation and attribution, share price of the Company and the discount.
The Directors take into account a number of different indicators as the
Company does not have a formal benchmark, and performance against these is
shown in the Financial Highlights.
Performance is discussed in the Chairman’s Statement and Investment
Manager’s Report.
PRINCIPAL RISKS AND UNCERTAINTIES
The principal risks identified by the Board, and the steps the Board takes
to mitigate them, are discussed below. The audit committee reviews
existing and emerging risks on a six monthly basis. The Board has closely
monitored the societal, economic and market focused implications of the
events in 2021 and 2022.
Investment strategy
Inappropriate long-term strategy, asset allocation and fund selection
could lead to underperformance. The Board discusses investment
performance at each of its meetings and the Directors receive reports
detailing asset allocation, investment selection and performance.
Business conditions and general economy
The Company’s future performance is heavily dependent on the performance
of different equity and currency markets. The Board cannot mitigate the
risks arising from adverse market movements. However, diversification
within the portfolio will reduce the impact. Further information is given
in portfolio risks below.
Macro-economic event risk
The Covid pandemic was felt globally in 2021 and 2022 although economies
and markets have recovered. The scale and potential adverse impact of a
macro-economic event, such as the Covid pandemic, has highlighted the
possibility of a number of identified risks such as market risk, currency
risk, investment liquidity risk and operational risk having an adverse
impact at the same time. The risk may impact on: the value of the
Company’s investment portfolio, its liquidity, meaning investments cannot
be realised quickly, or the Company’s ability to operate if the Company’s
suppliers face financial or operational difficulties. The Directors
closely monitor these areas and currently maintain a significant cash
balance.
Portfolio risks - market price, foreign currency and interest rate risks
The largest investments are listed above. Investment returns will be
influenced by interest rates, inflation, investor sentiment,
availability/cost of credit and general economic and market conditions in
the UK and globally. A significant proportion of the portfolio is in
investments denominated in foreign currencies and movements in exchange
rates could significantly affect their sterling value. The Investment
Manager takes all these factors into account when making investment
decisions but the Company does not normally hedge against foreign currency
movements. The Board’s policy is to hold a spread of investments in order
to reduce the impact of the risks arising from the above factors by
investing in a spread of asset classes and geographic regions.
Net asset value discount
The discount in the price at which the Company’s shares trade to net asset
value means that shareholders cannot realise the real underlying value of
their investment. Over the last few years the Company’s share price has
been at a significant discount to the Company’s net asset value. The
Directors regularly review the level of discount, however given the
investor base of the Company, the Board is very restricted in its ability
to influence the discount to net asset value.
Investment Manager
The quality of the team employed by the Investment Manager is an important
factor in delivering good performance and the loss of key staff could
adversely affect returns. A representative of the Investment Manager
attends each Board meeting and the Board is informed if any major changes
to the investment team employed by the Investment Manager are proposed.
The Investment Manager regularly informs the Board of developments and any
key implications for either the investment strategy or the investment
portfolio.
Tax and regulatory risks
A breach of The Investment Trust (Approved Company) (Tax) Regulations 2011
(the ‘Regulations’) could lead to capital gains realised within the
portfolio becoming subject to UK capital gains tax. A breach of the FCA
Listing Rules could result in suspension of the Company’s shares, while a
breach of company law could lead to criminal proceedings, financial and/or
reputational damage. The Board employs Brompton Asset Management Limited
as Investment Manager, and Maitland Administration Services Limited as
Secretary and Administrator, to help manage the Company’s legal and
regulatory obligations.
Operational
Disruption to, or failure of, the Investment Manager’s or Administrator’s
accounting, dealing or payment systems, or the Custodian’s records, could
prevent the accurate reporting and monitoring of the Company’s financial
position. The Company is also exposed to the operational risk that one or
more of its suppliers may not provide the required level of service. How
the Board monitors its service providers, with an emphasis on their
business interruption procedures, is set out in the Corporate Governance
Statement.
The Directors confirm that they have carried out a robust assessment of
the risks and emerging risks facing the Company, including those that
would threaten its business model, future performance, solvency and
liquidity.
VIABILITY STATEMENT
The assets of the Company consist mainly of securities that are readily
realisable or cash and it has no significant liabilities and no financial
commitments. Investment income has exceeded annual expenditure and current
liquid net assets cover current annual expenses for many years.
Accordingly, the Company is of the opinion that it has adequate financial
resources to continue in operational existence for the long term which is
considered to be in excess of five years. Five years is considered a
reasonable period for investors when making their investment decisions.
In reaching this view the Directors reviewed the anticipated level of
annual expenditure against the cash and liquid assets within the
portfolio. The Directors have also considered the risks the Company faces
in making this viability statement.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE ISSUES
The Company has no employees, with day-to-day operational and
administration of the Company being delegated by the Board to the
Independent Investment Manager and the Administrator. The Company’s
portfolio is managed in accordance with the investment objective and
policy approved by shareholders. The Company is primarily invested in
investment funds and exchange traded funds, where it has no direct
dialogue with the underlying investments. Environmental, social and
governance considerations of underlying investee companies are not a key
driver when evaluating existing and potential investments.
GREENHOUSE GAS EMISSIONS
As the Company has no premises, properties or equipment of its own, the
Directors deem the Company to be exempt from making any disclosures under
the Companies Act 2006 (Strategic Reports and Directors’ Reports)
Regulations 2013.
STREAMLINED ENERGY AND CARBON REPORTING
The Company is categorised as a lower energy user under the HMRC
Environmental Reporting Guidelines March 2019 and is therefore not
required to make the detailed disclosures of energy and carbon information
set out within the guidelines. The Company’s energy and carbon
information is not therefore disclosed in this report.
MODERN SLAVERY ACT
The Directors rely on undertakings given by its independent third party
advisers that those companies continue to have no instances of modern
slavery either within their businesses or supply chains. Given the
financial services focus and geographical location of all third party
suppliers to the Company, the Directors perceive the risks of a
contravention of the legislation to be very low.
GENDER DIVERSITY
The Board of Directors comprises three male directors, and currently no
female board members. Composition of the Board has not changed since
2017, and the Board has benefited from stable membership and strong
working relationships between individual directors in that time. For this
reason, the Board does not currently anticipate making future changes.
The Board is committed to the benefits of diversity, including gender,
ethnicity and background when considering new appointments to the Board,
whilst always seeking to base any decision on merit, measured by
knowledge, experience and ability to make a positive contribution to the
Board’s decision making.
CLIMATE RELATED REPORTING
As a closed-end investment fund, the Group is exempt from any climate
related reporting. The Group mainly invests in funds. Those funds are
responsible for determining the impact of climate change when making their
investment decisions. The Group does not influence the investment
decisions of the funds it invests in.
LISTING RULE 9.8.4
Listing rule 9.8.4 requires the Company to include certain information in
a single identifiable section of the Annual Report or a cross-reference
table indicating where the information is set out. The Directors confirm
that there were no disclosures to be made in this regard.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME AT 30TH JUNE 2022
Year ended Year ended
30th June 2022 30th June 2021
Revenue Revenue
Return Capital Return Capital
Return Total Return Total
£ ‘000 £ ‘000 £ ‘000 £ ‘000 £ ‘000 £ ‘000
Notes
INVESTMENT 2 1,837 - 1,837 1,519 - 1,519
INCOME
Other operating 2 20 - 20 3 - 3
income
1,857 - 1,857 1,522 - 1,522
GAINS AND LOSSES
ON INVESTMENTS
(Losses)/gains
on investments
at fair value
through profit 9 - (15,188) (15,188) - 25,927 25,927
or loss
Legal and
professional - (60) (60) - - -
costs
Other exchange - 1,382 1,382 - (1,119) (1,119)
gains/(losses)
Trail rebates - 6 6 - 4 4
1,857 (13,860) (12,003) 1,522 24,812 26,334
EXPENSES
Management fees 3 (837) - (837) (774) - (774)
Other expenses 4 (320) - (320) (319) - (319)
(1,157) - (1,157) (1,093) - (1,093)
(LOSS)/PROFIT 700 (13,860) (13,160) 429 24,812 25,241
BEFORE TAX
Tax 5 - - - - - -
(LOSS)/PROFIT 700 (13,860) (13,160) 429 24,812 25,241
FOR THE YEAR
EARNINGS PER
SHARE
Ordinary shares 7 0.98p (19.51)p (18.53)p 0.61p 34.93p 35.54p
(pence)
The total column of this statement represents the Group's profit and loss
account, prepared in accordance with UK adopted international accounting
standards. The supplementary Revenue Return and Capital Return columns are
both prepared under guidance published by the Association of Investment
Companies. All revenue and capital items in the above statement derive
from continuing operations.
The Company did not have any income or expense that was not included in
‘(Loss)/Profit for the year’. Accordingly, the ‘(Loss)/Profit for the
year’ is also the ‘Total comprehensive income for the year’, as defined in
IAS 1(revised) and no separate Statement of Comprehensive Income has been
presented.
No operations were acquired or discontinued during the year.
All income is attributable to the equity holders of the parent company.
There are no minority interests.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30TH JUNE
2022
Share Share Special Retained
premium reserve earnings
Note capital Total
£ ‘000 £ ‘000 £ ‘000
£ ‘000 £ ‘000
AT 30th JUNE 2021 710 21,573 56,908 58,941 138,132
Total comprehensive loss - - - (13,160) (13,160)
for the year
Dividend paid 8 - - - (994) (994)
AT 30th JUNE 2022 710 21,573 56,908 44,787 123,978
Included within Retained earnings were £1,666,000 of Company reserves
available for distribution.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30TH JUNE
2021
Share Share Special Retained
premium reserve earnings
Note capital Total
£ ‘000 £ ‘000 £ ‘000
£ ‘000 £ ‘000
AT 30th JUNE 2020 710 21,573 56,908 34,694 113,885
Total comprehensive income - - - 25,241 25,241
for the year
Dividend paid 8 - - - (994) (994)
AT 30th JUNE 2021 710 21,573 56,908 58,941 138,132
Included within Retained earnings were £1,960,000 of Company reserves
available for distribution.
CONSOLIDATED BALANCE SHEET AT 30TH JUNE 2022
30th June 30th June
Notes 2022 2021
£ ‘000 £ ‘000
NON-CURRENT ASSETS
Investments at fair value through profit or loss 9 99,450 129,727
CURRENT ASSETS
Other receivables 11 258 235
Cash and cash equivalents 12 24,530 8,440
24,788 8,675
TOTAL ASSETS 124,238 138,402
CURRENT LIABILITIES
Other payables 13 (260) (270)
TOTAL ASSETS LESS CURRENT LIABILITIES 123,978 138,132
NET ASSETS 123,978 138,132
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS
Called-up share capital 14 710 710
Share premium 15 21,573 21,573
Special reserve 15 56,908 56,908
Retained earnings 15 44,787 58,941
TOTAL EQUITY 123,978 138,132
NET ASSET VALUE PER ORDINARY SHARE 16 174.56p 194.49p
CONSOLIDATED CASH FLOW STATEMENTS AT 30TH JUNE 2022
Year ended Year ended Year ended Year ended
30th June 30th June 30th June 30th June
2022 2022 2021 2021
Group Company Group Company
Notes £ ‘000 £ ‘000 £ ‘000 £ ‘000
NET CASH INFLOW FROM
OPERATING ACTIVITIES
673 673 376 376
INVESTING ACTIVITIES
Purchase of investments (11,861) (11,861) (9,717) (9,717)
Sale of investments 26,950 26,950 8,932 8,932
Legal and professional (60) (60) - -
costs
NET CASH
INFLOW/(OUTFLOW) FROM
INVESTING ACTIVITIES 15,029 15,029 (785) (785)
FINANCING
Equity dividends paid 8 (994) (994) (994) (994)
NET CASH OUTFLOW FROM
FINANCING
(994) (994) (994) (994)
INCREASE/(DECREASE) IN 14,708 14,708 (1,403) (1,403)
CASH
RECONCILIATION OF NET
CASH FLOW TO MOVEMENT IN
CASH & CASH EQUIVALENTS
Increase/(decrease) in
cash resulting from cash 14,708 14,708 (1,403) (1,403)
flows
Exchange movements 1,382 1,382 (1,119) (1,119)
Movement in net funds 16,090 16,090 (2,522) (2,522)
Net funds at start of 8,440 8,440 10,962 10,962
the year
CASH & CASH EQUIVALENTS 17 24,530 24,530 8,440 8,440
AT END OF YEAR
RECONCILIATION OF PROFIT
BEFORE
FINANCE COSTS AND
TAXATION TO NET CASH
FLOW FROM OPERATING
ACTIVITIES
(Loss)/profit before
finance costs and (13,160) (13,160) 25,241 25,241
taxation*
(Losses)/gains on 15,188 15,188 (25,927) (25,241)
investments
Legal and professional 60 60 - -
costs
Exchange differences (1,382) (1,382) 1,119 1,119
Capital trail rebates (6) (6) (4) (4)
Net revenue gains before 700 700 429 935
taxation
Decrease/(Increase) in (30) (30) (90) (90)
debtors
(Decrease)/Increase in (10) (10) 41 (465)
creditors
Taxation 7 7 (8) (8)
Capital trail rebates 6 6 4 4
NET CASH INFLOW FROM 673 673 376 376
OPERATING ACTIVITIES
*Includes dividends received in cash of £1,653,000 (2021: £1,273,000),
accumulation income of £149,000 (2021: £187,000) and interest received of
£20,000 (2021: £3,000).
NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 30TH JUNE 2022
1. ACCOUNTING POLICIES
The financial statements have been prepared in accordance with UK adopted
international accounting standards.
These financial statements are presented in pounds sterling, the Group’s
functional currency, being the currency of the primary economic
environment in which the Group operates, rounded to the nearest thousand.
(a) Basis of preparation: The financial statements have been prepared on a
going concern basis (see 1(p)). The principal accounting policies adopted
are set out below.
Where presentational guidance set out in the Statement of Recommended
Practice ‘Financial Statements of Investment Trust Companies and Venture
Capital Trusts’ ('SORP') issued by the Association of Investment Companies
('AIC') in November 2014 and updated in February 2018 and October 2019
with consequential amendments is consistent with the requirements of UK
adopted International Accounting Standards, the Directors have sought to
prepare the financial statements on a basis compliant with the
recommendations of the SORP.
(b) Basis of consolidation: The consolidated financial statements include
the accounts of the Company and its subsidiary made up to 30th June 2022.
No statement of comprehensive income is presented for the parent company
as permitted by Section 408 of the Companies Act 2006.
The Company is an investment entity as defined by UK adopted International
Accounting Standards and assets are held at their fair value reflecting
the impact, if any, of climate change (see 1 (g)). The consolidated
accounts include subsidiaries which are an integral part of the Group and
not investee companies.
Subsidiaries are consolidated from the date of their acquisition, being
the date on which the Company obtains control, and continue to be
consolidated until the date that such control ceases. The financial
statements of the subsidiary used in the preparation of the consolidated
financial statements are based on consistent accounting policies. All
intra-group balances and transactions, including unrealised profits
arising therefrom, are eliminated. Subsidiaries are valued at fair value,
which is considered to be their NAV, in the accounts of the Company.
(c) Presentation of Statement of Comprehensive Income: In order to better
reflect the activities of an investment trust company and in accordance
with guidance issued by the AIC, supplementary information which analyses
the consolidated statement of comprehensive income between items of a
revenue and capital nature has been presented alongside the consolidated
statement of comprehensive income.
In accordance with the Company's Articles of Association, net capital
returns may not be distributed by way of a dividend. Additionally, the net
revenue profit is the measure the Directors believe is appropriate in
assessing the Group's compliance with certain requirements set out in the
Investment Trust (Approved Company) (Tax) Regulations 2011.
(d) Use of estimates: The preparation of financial statements requires the
Group to make estimates and assumptions that affect items reported in the
consolidated and parent company balance sheets and consolidated statement
of comprehensive income and the disclosure of contingent assets and
liabilities at the date of the financial statements. Although these
estimates are based on the Directors’ best knowledge of current facts,
circumstances and, to some extent, future events and actions, the Group’s
actual results may ultimately differ from those estimates, possibly
significantly. The most significant estimate relates to the valuation of
unquoted investments.
(e) Revenue: Dividends and other such revenue distributions from
investments are credited to the revenue column of the consolidated
statement of comprehensive income on the day in which they are quoted
ex-dividend. Where the Company has elected to receive its dividends in
the form of additional shares rather than in cash and the amount of the
cash dividend is recognised as income, any excess in the value of the
shares received over the amount recognised is credited to the capital
reserve. Deemed revenue from offshore funds is credited to the revenue
account. Interest on fixed interest securities and deposits is accounted
for on an accruals basis.
(f) Expenses: Expenses are accounted for on an accruals basis. Management
fees, administration and other expenses, with the exception of transaction
charges, are charged to the revenue column of the consolidated statement
of comprehensive income. Performance fees and transaction charges are
charged to the capital column of the consolidated statement of
comprehensive income.
(g) Investments held at fair value: Purchases and sales of investments are
recognised and derecognised on the trade date where a purchase or sale is
under a contract whose terms require delivery within the timeframe
established by the market concerned, and are initially measured at fair
value.
All investments are classified as held at fair value through profit or
loss on initial recognition and are measured at subsequent reporting dates
at fair value, which is either the quoted bid price or the last traded
price, depending on the convention of the exchange on which the investment
is quoted. Investments in units of unit trusts or shares in OEICs are
valued at the bid price for dual priced funds, or single price for
non-dual priced funds, released by the relevant investment manager.
Unquoted investments are valued by the Directors at the balance sheet date
based on recognised valuation methodologies, in accordance with
International Private Equity and Venture Capital ('IPEVC') Valuation
Guidelines such as dealing prices or third party valuations where
available, net asset values and other information as appropriate.
As the quoted investments hold listed companies, the fair value prices
should reflect the impact, if any, of climate change.
(h) Taxation: The charge for taxation is based on taxable income for the
year. Withholding tax deducted from income received is treated as part of
the taxation charge against income. Taxation deferred or accelerated can
arise due to temporary differences between the treatment of certain items
for accounting and taxation purposes. Full provision is made for deferred
taxation under the liability method on all temporary differences not
reversed by the Balance Sheet date. No deferred tax provision is made
against deemed reporting offshore funds. Deferred tax assets are only
recognised when there is more likelihood than not that there will be
suitable profits against which they can be applied.
(i) Foreign currency: Assets and liabilities denominated in foreign
currencies are translated at the rates of exchange ruling at the balance
sheet date. Foreign currency transactions are translated at the rates of
exchange applicable at the transaction date. Exchange gains and losses
are taken to the revenue or capital column of the consolidated statement
of comprehensive income depending on the nature of the underlying item.
(j) Capital reserve: The following are accounted for in this reserve:
- gains and losses on the realisation of investments together with the
related taxation effect;
- foreign exchange gains and losses on capital transactions, including
those on settlement, together with the related taxation effect;
- revaluation gains and losses on investments;
- legal expenses in assessing potential investments or incurred in
disposing of investments; and
- trail rebates received from the investment managers of the Company’s
investments.
The capital reserve is not available for the payment of dividends.
(k) Revenue reserve: This reserve includes net revenue recognised in the
revenue column of the Statement of Comprehensive Income.
(l) Special reserve: The special reserve can be used to finance the
redemption and/or purchase of shares in issue.
(m) Cash and cash equivalents: Cash and cash equivalents comprise current
deposits and balances with banks. Cash and cash equivalents may be held
for the purpose of either asset allocation or managing liquidity.
(n)Dividends payable: Dividends are recognised from the date on which they
are irrevocably committed to payment.
(o) Segmental Reporting: The Directors consider that the Group is engaged
in a single segment of business with the primary objective of investing in
securities to generate long term capital growth for its shareholders.
Consequently no business segmental analysis is provided.
(p) Going concern basis of preparation: The financial statements are
prepared on a going concern basis under the historical cost convention,
and on the assumption that approval as an investment trust under section
1158 of the Corporation Tax Act 2010 and the Investment Trust (Approved
Company) (Tax) Regulations 2011 will be retained.
(q) New standards, interpretations and amendments effective for the
periods beginning on or after 1st July 2021: There are no new standards,
amendments to standards and interpretations that have impacted the Group
and should be disclosed.
(r) New standards, interpretations and amendments issued which are not yet
effective and applicable for the periods beginning on or after 1st July
2022: There are no new standards, amendments to standards and
interpretations that will impact the Group and should be disclosed.
2. INVESTMENT INCOME
Year ended Year ended
30th June 30th June
2022 2021
£ ‘000 £ ‘000
INCOME FROM INVESTMENTS
UK net dividend income 1,581 1,278
Unfranked investment income 219 238
UK fixed interest 37 3
1,837 1,519
OTHER OPERATING INCOME
Bank interest receivable 20 3
20 3
TOTAL INCOME COMPRISES
Dividends 1,800 1,516
Other income 57 6
1,857 1,522
The above dividend and interest income has been included in the profit
before finance costs and taxation included in the cash flow statements.
3. MANAGEMENT AND PERFORMANCE FEES
Year ended Year ended
30th June 2022 30th June 2021
Revenue Capital Total Revenue Capital Total
£ ‘000 £ ‘000
£ ‘000 £ ‘000 £ ‘000 £ ‘000
Investment management fee 837 - 837 774 - 774
837 - 837 774 - 774
At 30th June 2022 there were amounts accrued of £193,000 (2021: £214,000)
for investment management fees.
4. OTHER EXPENSES
Year ended Year ended
30th June 30th June
2022 2021
£ ‘000 £ ‘000
Directors’ remuneration 65 65
Administrative and secretarial fee 95 95
Auditors’ remuneration
- Audit 55 41
- Interim review - 8
Other 105 110
320 319
Allocated to:
- Revenue 320 319
- Capital - -
320 319
5. TAXATION
(a) Analysis of tax charge for the year:
Year ended Year ended
30th June 2022 30th June 2021
Revenue
Return Capital Revenue Capital
Return Return Return
£ ‘000 £ ‘000 Total £ ‘000 Total
£ ‘000 £ ‘000 £ ‘000
Overseas tax 2 - 2 9 - 9
Recoverable income tax (2) - (2) (9) - (9)
Total current tax for the - - - - - -
year
Deferred tax - - - - - -
Total tax for the year - - - - - -
(note 5b)
(b) Factors affecting tax charge for the year:
The charge for the year of £nil (2021: £nil) can be reconciled to the
profit per the consolidated statement of comprehensive income as follows:
Year ended Year ended
30th June 30th June
2022 2021
£ ‘000 £ ‘000
Total (loss)/profit before tax (13,160) 25,241
Theoretical tax at the UK corporation tax rate of (2,500) 4,796
19.00% (2021: 19.00%)
Effects of:
Non-taxable UK dividend income (300) (243)
Gains and losses on investments that are not taxable 2,623 (4,714)
Excess expenses not utilised 197 188
Overseas dividends which are not taxable (20) (27)
Overseas tax 2 9
Recoverable income tax (2) (9)
Total tax for the year - -
Due to the Company’s tax status as an investment trust and the intention
to continue meeting the conditions required to maintain approval of such
status in the foreseeable future, the Company has not provided tax on any
capital gains arising on the revaluation or disposal of investments.
There is no deferred tax (2021: £nil) in the capital account of the
Company. There is no deferred tax charge in the revenue account (2021:
£nil).
At the year-end there is an unrecognised deferred tax asset of £884,000
(2021: £669,000) based on the enacted tax rates of 19% for financial years
beginning 1st April 2022, as a result of excess expenses.
6. COMPANY RETURN FOR THE YEAR
The Company’s total loss for the year was £13,160,000 (2021: profit
£25,241,000).
7. RETURN PER ORDINARY SHARE
Total return per Ordinary share is based on the Group total loss on
ordinary activities after taxation of £13,160,000 (2021: profit
£25,241,000) and on 71,023,695 (2021: 71,023,695) Ordinary shares, being
the weighted average number of Ordinary shares in issue during the year.
Revenue return per Ordinary share is based on the Group revenue profit on
ordinary activities after taxation of £700,000 (2021: £429,000) and on
71,023,695 (2021: 71,023,695) Ordinary shares, being the weighted average
number of Ordinary shares in issue during the year.
Capital return per Ordinary share is based on net capital loss for the
year of £13,860,000 (2021: profit £24,812,000) and on 71,023,695 (2021:
71,023,695) Ordinary shares, being the weighted average number of Ordinary
shares in issue during the year.
8. DIVIDENDS ON EQUITY SHARES
Amounts recognised as distributions in the year:
Year ended Year ended
30th June 30th June
2022 2021
£ ‘000 £ ‘000
Dividends paid during the year 994 994
Dividends payable in respect of the year ended:
30th June 2022: 1.4p (2021: 1.4p) per share 994 994
It is proposed that a dividend of 1.4p per share will be paid in respect
of the current financial year.
9. INVESTMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS
Year ended Year ended
30th June 30th June
2022 2022
£ ‘000 £ ‘000
GROUP AND COMPANY 99,450 129,727
ANALYSIS OF INVESTMENT
PORTFOLIO – GROUP AND COMPANY
Quoted* Unquoted Total
£ ‘000 £ ‘000 £ ‘000
Opening book cost 68,281 9,428 77,709
Opening investment holding gains 44,200 7,818 52,018
Opening valuation 112,481 17,246 129,727
Movement in period
Purchases at cost 7,819 4,042 11,861
Sales
- Proceeds (8,738) (18,212) (26,950)
- Realised gains/(losses) on sales 3,534 14,841 18,375
Movement in investment holding gains for the (18,259) (15,304) (33,563)
year
Closing valuation 96,837 2,613 99,450
Closing book cost 70,896 10,099 80,995
Closing investment holding gains 25,941 (7,486) 18,455
Closing valuation 96,837 2,613 99,450
* Quoted investments include unit trust and OEIC funds and one monthly
priced fund.
Year ended Year ended
30th June 30th June
2022 2021
£ ‘000 £ ‘000
ANALYSIS OF CAPITAL GAINS AND LOSSES
Realised gains on sales of investments 18,375 745
Investment holding (losses)/gains (33,563) 25,182
Net (losses)/gains on investments attributable to (15,188) 25,927
ordinary shareholders
Transaction costs
The purchase and sale proceeds figures above include transaction costs on
purchases of £1,984 (2021: £680) and on sales of £nil (2021: £nil).
10. INVESTMENT IN SUBSIDIARY UNDERTAKING
The Company owns the whole of the issued share capital (£1) of JIT
Securities Limited, a company registered in England and Wales.
The financial position of the subsidiary is summarised as follows:
Year ended Year ended
30th June 30th June
2022 2021
£ ‘000 £ ‘000
Net assets brought forward - 506
Dividend paid to parent - (506)
Net assets carried forward - -
11. OTHER RECEIVABLES
30th June 30th June
2022 2021
Group Group
£ ‘000 £ ‘000
Prepayments and accrued income 253 223
Taxation 5 12
258 235
12. CASH AND CASH EQUIVALENTS
30th June 30th June
2022 2021
Group Group
£ ‘000 £ ‘000
Cash at bank and on deposit 24,530 8,440
13. OTHER PAYABLES
30th June 30th June
2022 2021
Group Group
£ ‘000 £ ‘000
Accruals 260 270
260 270
14. CALLED UP SHARE CAPITAL
30th June 30th June
2022 2021
£ ‘000 £ ‘000
Authorised
305,000,000 (2021: 305,000,000) Ordinary shares of 3,050 3,050
£0.01 each
Issued and fully paid
71,023,695 (2021: 71,023,695) Ordinary shares of £0.01 710 710
each
15. RESERVES
Share Special Retained
Premium Reserve earnings
account
£ ‘000 £ ‘000 £ ‘000
GROUP
At 30th June 2021 21,573 56,908 58,941
Decrease in investment holding gains - - (33,563)
Net gains on realisation of investments - - 18,375
Gains on foreign currency - - 1,382
Trail rebates - - 6
Legal fees allocated to capital - - (60)
Retained revenue profit for year - - 700
Dividend paid - - (994)
At 30th June 2022 21,573 56,908 44,787
The components of retained earnings are set out below:
30th June 30th June
2022 2021
£ ‘000 £ ‘000
GROUP
Capital reserve - realised 24,666 5,316
Capital reserve - revaluation 18,455 52,018
Revenue reserve 1,666 1,607
44,787 58,941
16. NET ASSET VALUE PER ORDINARY SHARE
The net asset value per Ordinary share is calculated on net assets of
£123,978,000 (2021: £138,132,000) and 71,023,695 (2021: 71,023,695)
Ordinary shares in issue at the year end.
17. ANALYSIS OF CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
At 1st July At 30th June
2021 Cash flow Exchange 2022
movement
£ ‘000 £ ‘000
GROUP
Cash at bank and on 8,440 14,708 1,382 24,530
deposit
18. FINANCIAL INFORMATION
2022 Financial information
The figures and financial information for 2022 are unaudited and do not
constitute the statutory accounts for the year. The preliminary statement
has been agreed with the Company’s auditors and the Company is not aware
of any likely modification to the auditor’s report required to be included
with the annual report and accounts for the year ended 30th June 2022.
2021 Financial information
The figures and financial information for 2021 are extracted from the
published Annual Report and Accounts for the year ended 30th June 2021 and
do not constitute the statutory accounts for the year. The Annual Report
and Accounts for the year-end 30th June 2021 (available on the Company’s
website 1 www.nsitplc.com) has been delivered to the registrar of
Companies and includes the Independent Auditors report which was
unqualified and did not contain a statement under either section 498 (2)
or section 498 (3) of the Companies Act 2006.
Annual Report and Accounts
The accounts for the year ended 30th June 2022 will be sent to
shareholders in October 2022 and will be available on the Company’s
website or in hard copy format at the Company’s registered office, 1
Knightsbridge Green, London SW1X 7QA and will be available for
inspection. A copy will also be submitted to the FCA's National Storage
Mechanism.
The Annual General Meeting of the Company will be held on 17th November
2022 at 11.00am at 1 Knightsbridge Green, London SW1X 7QA.
11th October 2022
══════════════════════════════════════════════════════════════════════════
ISIN: GB0002631041
Category Code: ACS
TIDM: NSI
Sequence No.: 193677
EQS News ID: 1460837
End of Announcement EQS News Service
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