Final Results

Baillie Gifford Shin Nippon PLC 02 March 2007 BAILLIE GIFFORD SHIN NIPPON PLC Results for the year to 31 January 2007 The twelve months to 31 January 2007 have proved very difficult for investing in Japanese smaller companies. During this period, the Company's net asset value per share has outperformed its comparative index*, with the Company's net asset value per share declining by 25.2% compared with a 26.9% decline in the comparative index*. With small company valuations now back at a discount to those of their larger counterparts, the Managers are finding numerous investment opportunities, especially among the faster growing companies which have been de-rated particularly sharply. Consequently, net gearing was increased to 18% before the year end. • During the Company's financial year, stock selection made a positive contribution to the Company's relative performance, most notably in the Commerce and services and Real estate and construction sectors. • An increase in net gearing in the summer proved premature. However, despite the impact on performance during the year, the Board and Managers believe that the opportunity to gear the portfolio into a reflating economy at such low rates is very attractive. • The Board and Managers hold the view that the recent moderate slowdown in Japanese economic growth is temporary within a much longer process of expansion and revitalisation. The companies we are investing in are performing well on the back of strong profits growth and the Board and Managers expect this to continue. • The Board recently took the opportunity to issue 500,000 shares at a premium to net asset value of 2.4%. * The Company's comparative index is a composite index of the Tokyo Second Section Index, the TOPIX Small Index and the JASDAQ Index, weighted by market capitalisation, in sterling terms. Shin Nippon aims to achieve long-term capital growth principally through investment in small Japanese companies which are believed to have above average prospects for capital growth. At 31 January 2007 the Company had total assets of £77.4m (before deduction of bank loans of £12.2m). The Company is managed by Baillie Gifford & Co, an Edinburgh based fund management group with around £50 billion under management and advice as at 1 March 2007. - ends - For further information please contact: Alistair Way, Manager, Baillie Gifford & Co 0131 275 2000 Mike Lord, Director, Broadgate Marketing 020 7726 6111 BAILLIE GIFFORD SHIN NIPPON PLC The following is the unaudited preliminary statement for the year to 31 January 2007 which was approved by the Board on 1 March 2007. No dividend is payable. INCOME STATEMENT (unaudited) For the year ended For the year ended 31 January 2007 31 January 2006 Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000 (Losses)/gains on investments - (23,173) (23,173) - 32,668 32,668 Currency gains (note 2) - 1,538 1,538 - 538 538 Income (note 3) 929 - 929 780 - 780 Investment management fee (694) - (694) (675) - (675) Other administrative expenses (210) - (210) (207) - (207) Net return before finance costs and taxation 25 (21,635) (21,610) (102) 33,206 33,104 Finance costs of borrowings (226) - (226) (216) - (216) Net return on ordinary activities before taxation (201) (21,635) (21,836) (318) 33,206 32,888 Tax on ordinary activities (57) - (57) (47) - (47) Net return on ordinary activities after taxation (258) (21,635) (21,893) (365) 33,206 32,841 Net return per ordinary share (note 5) (0.84p) (70.70p) (71.54p) (1.20p) 108.52p 107.32p The total column of this statement is the profit and loss account of the Company. All revenue and capital items in this statement derive from continuing operations. A Statement of Total Recognised Gains and Losses is not required as all gains and losses of the Company have been reflected in the above statement. BAILLIE GIFFORD SHIN NIPPON PLC SUMMARISED BALANCE SHEET at 31 January 2007 (unaudited) 31 January 2007 31 January 2006 £'000 £'000 NET ASSETS Listed overseas equities 76,704 90,696 Unlisted - traded on the Hercules Japan market - 1,605 - other unlisted 197 1,419 Total investments 76,901 93,720 Net liquid assets 531 7,295 Total assets (before deduction of bank loans) 77,432 101,015 Bank loans (note 6) (12,248) (13,938) Net assets 65,184 87,077 CAPITAL AND RESERVES Called-up share capital 3,060 3,060 Capital reserves 67,277 88,912 Revenue reserve (5,153) (4,895) Shareholders' funds 65,184 87,077 Net asset value per ordinary share 213.0p 284.6p RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS For the year ended 31 January 2007 (unaudited) Share Share Capital Capital Capital Revenue Total capital premium redemption reserve - reserve - reserve shareholders' reserve realised unrealised funds £'000 £'000 £'000 £'000 £'000 £'000 £'000 Shareholders' funds at 1 February 2006 3,060 6,616 21,521 28,485 32,290 (4,895) 87,077 Return on ordinary activities after taxation - - - 5,872 (27,507) (258) (21,893) Shareholders' funds at 31 January 2007 3,060 6,616 21,521 34,357 4,783 (5,153) 65,184 For the year ended 31 January 2006 Share Share Capital Capital Capital Revenue Total capital premium redemption reserve - reserve - reserve shareholders' reserve realised unrealised funds £'000 £'000 £'000 £'000 £'000 £'000 £'000 Shareholders' funds at 1 February 2005 3,060 6,616 21,521 15,623 11,946 (4,530) 54,236 Return on ordinary activities after taxation - - - 12,862 20,344 (365) 32,841 Shareholders' funds at 31 January 2006 3,060 6,616 21,521 28,485 32,290 (4,895) 87,077 BAILLIE GIFFORD SHIN NIPPON PLC SUMMARISED CASH FLOW STATEMENT (unaudited) Year to Year to 31 January 2007 31 January 2006 £'000 £'000 £'000 £'000 NET CASH OUTFLOW FROM OPERATING ACTIVITIES (Note 8) (65) (35) NET CASH OUTFLOW FROM SERVICING OF FINANCE (238) (235) TOTAL TAX PAID (55) (46) FINANCIAL INVESTMENT Acquisitions of investments (31,127) (36,327) Disposals of investments 26,621 33,014 Realised currency loss (152) (324) NET CASH OUTFLOW FROM FINANCIAL INVESTMENT (4,658) (3,637) NET CASH OUTFLOW BEFORE FINANCING (5,016) (3,953) FINANCING Bank loans drawn down - 4,988 Bank loans repaid - (4,538) NET CASH INFLOW FROM FINANCING - 450 DECREASE IN CASH (5,016) (3,503) RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT Decrease in cash (5,016) (3,503) Net inflow from bank loans - (450) Exchange movement on bank loans 1,690 862 MOVEMENT IN NET DEBT IN THE YEAR (3,326) (3,091) NET DEBT AT 1 FEBRUARY (8,160) (5,069) NET DEBT AT 31 JANUARY (11,486) (8,160) BAILLIE GIFFORD SHIN NIPPON PLC TWENTY LARGEST EQUITY HOLDINGS at 31 January 2007 (unaudited) 2007 Name Business Value % of 2006 £'000 total Value assets £'000 USS Company Second-hand car auctioneer 2,649 3.4 1,952 Message Provides nursing services for the elderly 2,621 3.4 - Pronexus Financial printing services 2,464 3.2 - Suruga Corp Real estate broker 2,148 2.8 1,590 Funai Zaisan Consultants Consulting services 2,136 2.8 - Shinko Plantech Engineering company 2,093 2.7 - Nabtesco Hydraulic equipment 2,015 2.6 2,248 Moshi Moshi Hotline Call centre operator 1,936 2.5 2,011 Fintech Global Investment bank 1,894 2.4 - Horiba Manufacturer of measuring instruments and analysers 1,821 2.4 1,597 Ryobi Manufacturer of auto parts 1,804 2.3 2,053 Aruze Sells and leases pachislo machines 1,743 2.2 - Juki Sewing machines and electrical equipment 1,649 2.1 1,806 H.I.S. Discount travel agency 1,621 2.1 2,155 Nakanishi Dental equipment 1,520 2.0 1,589 Tokyu Livable Real estate business 1,520 2.0 1,967 Intage Marketing research services 1,510 1.9 1,066 Japan Asia Investment Venture capital company 1,509 1.9 2,168 Hamakyorex Trucking and warehousing 1,474 1.9 2,157 Modec Oil extraction machinery 1,370 1.8 1,430 37,497 48.4 25,789 BAILLIE GIFFORD SHIN NIPPON PLC NOTES (unaudited) 1. The financial statements for the year to 31 January 2007 have been prepared on the basis of the same accounting policies used for the year to 31 January 2006. The Directors consider the Company's functional currency to be sterling as the Company's shareholders are predominantly based in the UK and the Company is subject to the UK's regulatory environment. 31 January 2007 31 January 2006 £'000 £'000 2. Currency gains Realised exchange differences (152) 243 Unrealised exchange differences 1,690 295 1,538 538 3. Income includes stock lending fee income of £111,000 (2006 - £106,000). 4. No dividend will be declared. 5. Return per ordinary share Revenue return (258) (365) Capital return (21,635) 33,206 Total return (21,893) 32,841 The returns per ordinary share set out below are based on the above returns and on 30,600,497 (2006 - 30,600,497) ordinary shares, being the weighted average number of ordinary shares in issue during the year. Revenue return (0.84p) (1.20p) Capital return (70.70p) 108.52p Total return (71.54p) 107.32p 6. Bank loans of £12.2 million (Y2.9 billion) have been drawn down under yen loan facilities which are repayable between March 2007 and October 2012 (31 January 2006 - £13.9 million (Y2.9 billion)). 7. The Company has the authority to issue shares at a premium to net asset value and to buy back shares at a discount. No shares were issued or bought back during the year under review. However, subsequent to the year end, the Company issued 500,000 shares for a total consideration of approximately £1.1 million. 2007 2006 £'000 £'000 8. Reconciliation of Net Return before Finance Costs and Taxation to Net Cash Outflow from Operating Activities Net return before finance costs and taxation (21,610) 33,104 Losses/(gains) on investments 23,173 (32,668) Currency gains (1,538) (538) Increase in accrued income (22) (9) Increase in other debtors (2) (7) (Decrease)/increase in creditors (66) 83 (65) (35) BAILLIE GIFFORD SHIN NIPPON PLC NOTES (Ctd) (unaudited) 9. The financial information set out above does not constitute the Company's statutory accounts for the year ended 31 January 2007 under section 240 of the Companies Act 1985. The financial information for 2006 is derived from the statutory accounts for 2006, which have been delivered to the Registrar of Companies. The Auditors have reported on the 2006 accounts, their report was unqualified and did not contain a statement under section 237(2) or (3) of the Companies Act 1985. The statutory accounts for 2007 will be finalised on the basis of the financial information presented in this preliminary announcement and will be delivered to the Registrar of Companies following the Company's Annual General Meeting. None of the views expressed in this document should be construed as advice to buy or sell a particular investment. This information is provided by RNS The company news service from the London Stock Exchange

Companies

Baillie Gifford Shin Nippon (BGS)
UK 100
FTSE quotes by TradingView

Latest directors dealings

All directors dealings today