Half-year Report

Bankers Investment Trust PLC
26 June 2024
 

LEGAL ENTITY IDENTIFIER: 213800B9YWXL3X1VMZ69                                                                                   

 

THE BANKERS INVESTMENT TRUST PLC

('the Company')

 

Unaudited results for the half-year ended 30 April 2024

 

This announcement contains regulated information

 

INVESTMENT OBJECTIVE 

Over the long term, the Company aims to achieve capital growth in excess of the FTSE World Index and dividend growth greater than inflation, as measured by the UK Consumer Price Index ('CPI'), by investing in companies listed throughout the world.

 

INVESTMENT POLICY

The following investment ranges apply:

·       Equities: 80% to 100%

·       Debt securities and cash investments: 0% to 20%

·       Investment trusts, collective funds and derivatives: 0% to 15%

 

To achieve an appropriate spread of investment risk the portfolio is broadly diversified by geography, sector and company. The Manager ('Janus Henderson') has the flexibility to invest in any geographic region and any sector with no set limits on individual country or sector exposures and, therefore, the make-up and weighting of the portfolio may differ materially from the FTSE World Index.

 

The Manager primarily employs a bottom-up stock picking investment process, across six regional portfolios, to identify suitable opportunities. While each regional portfolio manager employs their own investment style, they all pay particular regard to cash generation and dividend growth over the medium term.

 

The Company can, but normally does not, invest up to 15% of its gross assets in any other investment companies (including listed investment trusts).

 

Derivatives

The Company may use financial instruments known as derivatives for the purpose of efficient portfolio management while maintaining a level of risk consistent with the risk profile of the Company.

 

Gearing

The Company can borrow to make additional investments with the aim of achieving a return that is greater than the cost of the borrowing. The Company can borrow up to 20% of net assets at the time of draw down.

 

PERFORMANCE HIGHLIGHTS

 

 30 April 2024

30 April 2023

Net asset value ('NAV') per share1

122.7p

112.3p

Share price

112.2p

100.6p

Revenue return per share

1.31p

1.29p

Dividends paid or declared in respect of the period2

1.344p

1.24p

           

Total return performance to 30 April 2024 (including dividends reinvested and excluding transaction costs)

 

6 months

%

1 year

%

3 years

%

5 years

%

10 years

 %

NAV3

17.5

14.3

17.0

50.5

174.0

FTSE World Index4

16.6

19.1

30.4

72.8

149.4

Share price5

21.5

14.4

5.2

38.4

154.5

 

 

1 Net asset value per share with debt at par

2 The first interim dividend for 2024 was paid on 31 May 2024; the second interim dividend has been declared and will be paid on 30 August 2024

3 Net asset value total return per share with income reinvested and with debt at fair value

4 For 10 years, the benchmark is a composite of the FTSE World Index and the FTSE All-Share Index

5 Share price total return using mid-market closing price

 

Sources: Janus Henderson, Morningstar Direct and LSEG Datastream



INTERIM MANAGEMENT REPORT

 

CHAIR'S STATEMENT

                                                                                                                                        

Dear shareholder

 

Performance 

Your Company has delivered a strong net asset value total return over the six months ended 30 April 2024 of 17.5% (2023: 8.1%) and a share price total return of 21.5% (2023: 5.4%), both returns outperforming the FTSE World Index total return of 16.6% (2023: 3.5%). Stock markets around the world rose in value principally due to solid corporate profit recovery exceeding forecasts by analysts. The anticipated tailwind of interest rate cuts from central banks never materialised as inflation remained higher than expected. The Fund Manager discusses the key drivers of performance in the period in more detail in his report.

 

Following a strategic review, our Manager has started a process of concentrating the portfolio into four regional portfolios and reducing the number of holdings to approximately 100. This will direct a greater amount of the Company's capital into the portfolio managers' best investment ideas and bring greater focus to the regional portfolios. The reduction in portfolios from six to four will create a Pan European portfolio, incorporating the UK, and a Pan Asian (ex Japan) portfolio, including the Chinese A shares. This will reduce the overlap within these regions and remove potential conflicts. We continue to believe in the value of regional specialists with access to stock markets right across the globe.

 

We are also pleased to announce that Jamie Ross, our European portfolio manager, will assume the role of Deputy Fund Manager, following the recent retirement of Mike Kerley. Jamie has over 17 years of financial industry experience and has been a member of the Company's investment team since late 2018. We look forward to working more closely with Jamie alongside our Fund Manager, Alex Crooke.

 

Revenue

Our net revenue for the six months was £15.9 million (2023: £16.5 million), equivalent to 1.31p per share (2023: 1.29p). The reduction in revenue was a result of lower interest income, partially offset by a lower finance cost following the repayment of the 8% 2023 debenture on 31 October 2023. A reduced share count following share buybacks resulted in the earnings per share increasing by 1.6% over the period.

 

A first interim dividend of 0.672p per share (2023: 0.62p) was paid on 31 May 2024.  The Board has declared a second interim dividend of 0.672p (2023: 0.62p) per share, an increase of 8.4%, which will be payable on 30 August 2024 to shareholders on the register on 26 July 2024.

 

The Board's current expectation is that the dividend for the full year will be at least 5% above the total dividend paid in 2023. This continues the Company's progressive dividend policy of successive annual dividend growth which it has achieved over the past 57 years.

 

Share buy-backs

The Company's share price has continued to trade at a wide discount to its net asset value and we have taken advantage of this opportunity to buy back shares from the market. This activity is beneficial to ongoing shareholders, as shares are only purchased when the Company's shares are trading at a discount to NAV, thereby enhancing shareholder value.

 

A total of 49,748,991 shares were bought back at an average discount of 12.3% to the net asset value in the six months ended 30 April 2024 (2023: 24,080,927 shares bought back at an average discount of 9.0%) for a total consideration of £53.4 million (2023: £24.9 million). The discount at 30 April 2024 was 8.6% (2023: 10.4%). 

 

Board changes

As mentioned at the year end, Julian Chillingworth retired from the Board at the Annual General Meeting in February 2024, having served as a Director for nine years, and as Senior Independent Director for the latter five years of his tenure. Richard West, who joined the Board on 1 April 2020, was appointed as the Company's Senior Independent Director on 23 April 2024.

 

Outlook

Economic recovery is now under way in the European and Chinese markets while growth remains robust in the US and Japan. Corporate earnings should therefore be expected to continue to grow, supported at some point by interest rate cuts later this year or next. While share price returns to date have discounted some of this positive outlook, valuations do not look stretched which will ensure that your Company is well placed to continue to grow.

 

 

Simon Miller  

Chair

25 June 2024 

 


FUND MANAGER'S REPORT                                                                                                               

 

Market Review

The six month period to the end of April 2024 has been a good time to be invested in equity markets, as a strong recovery in share prices led to most markets reaching new all-time highs. Investors were optimistic that fading price inflation would lead to the tight monetary policy being eased by rate cuts. However, as it turned out, rates were not cut during the period in any major market and instead it was the delivery of stronger-than-expected corporate profits that underpinned higher share prices. In most sectors, companies experienced improving margins as higher prices stuck and energy costs fell.

 

The US market was marginally the better performer during the period, closely followed by Europe, Japan and the UK. The best performing stocks continued to be those focused on delivering artificial intelligence ('AI') solutions, particularly in the US market. However, recovery was fairly broad based in most markets as financials, industrials and retail exposed companies performed best, while energy, utilities and telecoms were laggards.

 

Performance

As indicated in the Annual Report, a number of new holdings were purchased in zero yielding US technology companies, including Alphabet, Amazon and Meta. Results from these companies were well received during the period, as margins grew strongly on the back of reducing costs by closing loss-making divisions and growing revenues. The technology exposure in the overall portfolio was increased from 16.3% to 22.3%. Despite these new additions, performance in the US portfolio continued to lag the benchmark, driven principally by lack of exposure to Nvidia. There is exposure to semiconductor manufacture across a wide spectrum of technologies in each of the Japanese, US, Asian and European portfolios. However, Nvidia is garnering all the exposure, and investors chasing returns. Undoubtedly they are the leader in developing AI chips, but we do have concerns that new orders will start to plateau leading to pricing pressure, ultimately impacting their share price.

 

Performance in the Japanese portfolio was considerably better than the benchmark, delivering a return nearly 5% ahead. This was driven by recovery in financials as the Bank of Japan raised interest rates for the first time since 2007, ending the period of negative interest rates. The Yen weakened over the period but the stock market recovery more than made up for this, delivering a total return of 20.2% over the period. The European, Asian and Chinese portfolios also delivered returns in excess of their benchmarks.

 

Portfolio

The portfolio has grown in both the number of regions and stocks over the past decade, delivering diversification and access to new markets such as China and India. However this has thrown up conflicts as companies can be dual listed and choices within sectors have narrowed due to consolidation by merger or acquisition. We have therefore decided to consolidate the number of regions to four: North America, Pan Europe (to include the UK), Pan Asia (ex Japan) and Japan. We will continue to invest directly in the UK and Chinese markets but with a single investment team overseeing these regions with greater scope to invest more capital in the best companies across wider regions. Jamie Ross, supported by myself, will manage the Pan European portfolio and Sat Duhra will manage the Pan Asian portfolio.

 

Additionally, we have conducted a careful review of stock selection and portfolio construction. The conclusion of this work was that smaller holdings were not improving performance and by concentrating the portfolios, we would have a higher active stance, an indicator of greater divergence from the index. We therefore intend to increase the amount of capital in our best ideas by reducing the number of holdings towards 100. We will target regional portfolios of 20 investments with slightly more in the US, as it is a market with significantly more listed companies and therefore investment opportunities. We expect the tighter concentrated portfolio to be substantially implemented by the end of October 2024.

 

Outlook

We are excited by the prospect of a focused portfolio, investing more in our best ideas. In meetings with our investee companies, we are hearing positive messages about orders improving, restocking from customers and margins holding up. Inflation has fallen close to central bank targets and the first interest rate cuts have started in major economic regions. The overall outlook is more positive than six months ago and should support the increase in share prices we have seen this year.

 

 

Alex Crooke

Fund Manager 

25 June 2024

 

 

MANAGING OUR RISKS

 

The principal and emerging risks and uncertainties associated with the Company's business are divided into the following main areas:

 

·              Investment Activity and Performance Risks

·              Portfolio and Market Risks

·              Tax, Legal, Regulatory and Governance Risks

·              Financial Risks

·              Operational and Cyber Risks

·              Risks associated with Climate Change

 

Information on these risks and uncertainties and how they are managed are given in the Annual Report for the year ended 31 October 2023. Following a recent review, the Board has amended Tax, Legal and Regulatory Risk to include Governance. All other principal and emerging risks at the year-end remain and are as applicable to the remaining six months of the financial year as they were to the six months under review.

 

 

DIRECTORS' RESPONSIBILITY STATEMENT

 

The Directors (listed in note 15) confirm that, to the best of their knowledge:



(a)

the unaudited condensed set of financial statements has been prepared in accordance with IAS 34 - Interim Financial Reporting ('IAS 34') and gives a true and fair view of the assets, liabilities, financial position and profit or loss of the Company as required by Disclosure Guidance and Transparency Rule 4.2.4R;

 

(b)

the interim management report includes a fair review of the information required by Disclosure Guidance and Transparency Rule 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and



(c)

the interim management report includes a fair review of the information required by Disclosure Guidance and Transparency Rule 4.2.8R (disclosure of 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 the performance of the Company during the period; and any changes in related party transactions described in the latest annual report that could have an impact in the first six months of the current financial year).

 

 

 On behalf of the Board

 Simon Miller

 Chair

 25 June 2024

 

 

For further information contact: 

                                   

Alex Crooke

Fund Manager

The Bankers Investment Trust PLC

Telephone: 020 7818 4447

 

Simon Miller

Chair

The Bankers Investment Trust PLC

Telephone: 020 7818 4233

Dan Howe

Head of Investment Trusts

Janus Henderson Investors

Telephone: 020 7818 4458

Harriet Hall

PR Director, Investment Trusts

Janus Henderson Investors

Telephone: 020 7818 2636

 


CONDENSED STATEMENT OF COMPREHENSIVE INCOME


 

(Unaudited)

Half-year ended

30 April 2024

(Unaudited)

Half-year ended

30 April 2023

(Audited)

Year ended

31 October 2023

 

Revenue return £'000

Capital return £'000

 

Total £'000

Revenue return £'000

Capital return £'000

 

Total £'000

Revenue return £'000

Capital return £'000

 

Total

£'000

Gains on investments held at fair value through profit or loss

-

177,057

177,057

-

93,419

93,419

-

37,376

37,376

Investment income

19,107

-

19,107

19,070

-

19,070

40,439

-

40,439

Other operating income

567

-

567

1,073

-

1,073

1,326

-

1,326


---------

-----------

---------

---------

-----------

---------

-----------

------------

------------

Gross revenue and capital gains

19,674

177,057

196,731

20,143

93,419

113,562

41,765

37,376

79,141


----------

------------

-----------

----------

------------

-----------

------------

-----------

------------

Expenses

 

 

 







Management fees (note 2)

(910)

(2,123)

(3,033)

(887)

(2,071)

(2,958)

(1,790)

(4,176)

(5,966)

Other expenses

(642)

-

(642)

(378)

-

(378)

(970)

-

(970)


---------

-----------

---------

---------

-----------

---------

---------

---------

---------

Profit before finance costs and taxation

18,122

174,934

193,056

18,878

91,348

110,226

39,005

33,200

72,205

Finance costs

(519)

(1,151)

(1,670)

(712)

(1,573)

(2,285)

 

(1,376)

(3,211)

(4,587)


---------

------------

---------

---------

------------

---------

---------

------------

------------

Profit before taxation

17,603

173,783

191,386

18,166

89,775

107,941

37,629

29,989

67,618


---------

----------

---------

---------

----------

---------

---------

----------

---------

Taxation

(1,662)

(59)

(1,721)

(1,623)

-

(1,623)

(3,061)

-

(3,061)


---------

------------

---------

---------

------------

---------

---------

----------

---------

Profit for the period

15,941

173,724

189,665

16,543

89,775

106,318

34,568

29,989

64,557


=====

=======

======

=====

=======

======

======

=======

=======

Earnings per ordinary share (note 3)

1.31p

14.31p

15.62p

1.29p

6.97p

8.26p

2.72p

2.35p

5.07p


=====

======

======

=====

======

======

======

=======

=======

 

 

The total columns of this statement represent the Statement of Comprehensive Income, prepared in accordance with UK adopted international accounting standards. The revenue return and capital return columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies. 

 

All income is attributable to the equity shareholders of The Bankers Investment Trust PLC.

 

The accompanying condensed notes are an integral part of the financial statements.

 


CONDENSED STATEMENT OF CHANGES IN EQUITY

                                                                                                                                                        

 

 

 

 

Half-year ended 30 April 2024 (Unaudited)

 Called up

share capital

£'000

 Share premium

account

£'000

Capital redemption

reserve

£'000

Other capital reserves £'000

 

Revenue reserve

£'000

 

 

Total

£'000

Total equity at 1 November 2023

32,878

159,797

12,489

1,084,848

43,511

1,333,523

Total comprehensive income:

 

 

 

 

 

 

- Profit for the period

-

-

-

173,724

15,941

189,665

Transactions with owners, recorded

directly to equity:

 

 

 

 

 

 

  Buy-back of shares to treasury (note 5)

-

-

-

(53,389)

-

(53,389)

  Ordinary dividends paid (note 12)

-

-

-

-

(16,205)

(16,205)


----------

----------

----------

-------------

----------

--------------

Total equity at 30 April 2024

32,878

159,797

12,489

1,205,183

43,247

1,453,594

 

======

======

======

========

======

========








 

 

 

Half-year ended 30 April 2023 (Unaudited)

 Called up

share capital

£'000

Share premium

account £'000

Capital redemption

reserve

£'000

Other capital

reserves

£'000

 

Revenue reserve

£'000

 

 

Total

£'000

Total equity at 1 November 2022

32,878

159,797

12,489

1,115,343

40,159

1,360,666

Total comprehensive income:







- Profit for the period

-

-

-

89,775

16,543

106,318

Transactions with owners, recorded

directly to equity:







  Buy-back of shares to treasury (note 5)

-

-

-

(24,881)

-

(24,881)

  Ordinary dividends paid (note 12)

-

-

-

-

(15,535)

(15,535)


----------

----------

----------

-------------

----------

--------------

Total equity at 30 April 2023

32,878

159,797

12,489

1,180,237

41,167

1,426,568


======

======

======

========

======

========















 

 

 

Year ended 31 October 2023 (Audited)

 Called up

share capital

£'000

 Share premium

account £'000

Capital redemption

reserve £'000

Other capital

reserves

£'000

 

Revenue reserve

£'000

 

Total

£'000

Total equity at 1 November 2022

32,878

159,797

12,489

1,115,343

40,159

1,360,666

Total comprehensive income:







 - Profit for the year

-

-

-

29,989

34,568

64,557

Transactions with owners, recorded directly to equity:







  Buy-back of shares to treasury (note 5)  

-

-

-

(60,484)

-

(60,484)

  Ordinary dividends paid (note 12)

-

-

-

-

(31,216)

(31,216)


----------

----------

-----------

-------------

----------

-------------

Total equity at 31 October 2023

32,878

159,797

12,489

1,084,848

43,511

1,333,523


======

======

======

========

======

========

 

The accompanying condensed notes are an integral part of the financial statements.



CONDENSED STATEMENT OF FINANCIAL POSITION

 


(Unaudited)

As at 30 April

2024

£'000

(Unaudited)

As at 30 April

2023

£'000

(Audited)

As at 31 October

2023

£'000


 



Non-current assets

 



Investments held at fair value through profit or loss

1,530,994

1,489,862

1,428,787


-------------

-------------

--------------

 

 



Current assets

 



Investments held at fair value through profit or loss (note 4)

21,509

26,353

13,116

Other receivables

7,128

13,619

19,001

Cash and cash equivalents

28,726

43,863

14,525


--------------

--------------

--------------

 

57,363

83,835

46,642


--------------

--------------

--------------

Total assets

1,588,357

1,573,697

1,475,429


--------------

--------------

--------------

Current liabilities

 



Other payables

(10,604)

(6,801)

(17,006)

Debenture stock

-

(15,000)

-


--------------

--------------

--------------


(10,604)

(21,801)

(17,006)


--------------

--------------

--------------

Total assets less current liabilities

1,577,753

1,551,896

1,458,423


--------------

--------------

--------------

Non-current liabilities

 



Unsecured loan notes

(124,159)

(125,328)

(124,900)


--------------

--------------

--------------

Net assets

1,453,594

1,426,568

1,333,523

 

========

========

========


 



Equity attributable to equity shareholders

 



Share capital (note 5)

32,878

32,878

32,878

Share premium account

159,797

159,797

159,797

Capital redemption reserve

12,489

12,489

12,489

Retained earnings:

 



  Other capital reserves

1,205,183

1,180,237

1,084,848

  Revenue reserve

43,247

41,167

43,511


--------------

--------------

--------------

Total equity

1,453,594

1,426,568

1,333,523

 

========

========

========

Net asset value per ordinary share (note 6)

122.7p

112.3p

108.0p

 

======

======

======

 

 



 

The accompanying condensed notes are an integral part of the financial statements.

 

 

CONDENSED CASH FLOW STATEMENT

 

 

 

 

Reconciliation of profit before taxation to net cash flow

from operating activities

(Unaudited)

Half-year ended

 30 April

2024

£'000

(Unaudited)

Half-year ended

30 April

2023

£'000 

(Audited)

Year ended

31 October

 2023

£'000

Operating activities

 



Profit before taxation

191,386

107,941

67,618

Less: gain on investments held at fair value through profit or loss

(177,057)

(93,419)

(37,376)

Purchases of investments

(353,778)

(611,067)

(830,071)

Sales of investments

428,187

649,246

872,865

Indian capital gains tax paid on sales

(59)

-

-

Purchases of current asset investments

(49,907)

(44,581)

(80,700)

Sales of current asset investments

41,514

67,585

Increase in securities purchased for future settlement

13,540

2,915

12,119

Increase in securities sold for future settlement

(6,271)

(5,983)

-

Increase in other receivables

(32)

(87)

(58)

Decrease in other payables

(104)

(236)

(169)

Increase in accrued income

(1,651)

(2,854)

(14,217)

Add back interest payable ('finance costs')

1,670

2,285

4,587


------------

------------

------------

Net cash inflow from operating activities

before interest and taxation

87,438

22,389

62,183

Interest paid

(2,438)

(1,265)

(4,525)

Taxation on investment income

(1,647)

(1,822)

(3,290)


------------

------------

-------------

Net cash inflow from operating activities

83,353

19,302

54,368


=======

=======

=======


 



Financing activities

 



Equity dividends paid

(16,205)

(15,535)

(31,216)

Redemption of debenture

-

-

(15,000)

Share buy-backs

(53,389)

(24,881)

(59,579)


------------

------------

-------------

Net cash outflow from financing activities

(69,594)

(40,416)

(105,795)


=======

=======

=======


 



Increase/(decrease) in cash

13,759

(21,114)

(51,427)

Cash and cash equivalents at the start of the period

14,525

65,871

65,871

Exchange movements

442

(894)

81


-----------

-----------

-------------

Cash and cash equivalents at the end of the period

28,726

43,863

14,525

 

=======

=======

=======

 

   The accompanying condensed notes are an integral part of the financial statements.

 

 

NOTES TO THE CONDENSED FINANCIAL STATEMENTS:

 

1.

Accounting policies

 

The Bankers Investment Trust PLC ('the Company') is a company incorporated and domiciled in the United Kingdom under the Companies Act 2006.

 

These condensed financial statements comprise the unaudited results of the Company for the half-year ended

30 April 2024. They have been prepared on a going concern basis and in accordance with UK adopted international accounting standards and with the Statement of Recommended Practice for Investment Trusts ('SORP') dated July 2022, where the SORP is consistent with the requirements of UK adopted international accounting standards.

 

For the period under review, the Company's accounting policies have not varied in any material way from those described in the Annual Report for the year ended 31 October 2023.

 

These financial statements have not been either audited or reviewed by the Company's Auditor.

 


2.

Management fees

 

 

(Unaudited)

(Unaudited)

(Audited)

 

 

Half-year ended

30 April 2024

Half-year ended

30 April 2023

Year ended

31 October 2023

 

 

Revenue return

£'000

Capital return

£'000

Total

£'000

Revenue

return

£'000

Capital return

£'000

Total

£'000

Revenue return

£'000

Capital return

£'000

Total

£'000


Investment management

910

2,123

3,033

887

2,071

2,958

1,790

4,176

5,966



=====

=====

=====

=====

=====

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=====

=====

=====

 

 

3.

Earnings per ordinary share

 

The earnings per ordinary share figure is based on the net profit for the half-year of £189,665,000 (30 April 2023: net profit of £106,318,000; 31 October 2023: net profit of £64,557,000) and on 1,214,507,013 (30 April 2023: 1,286,965,652; 31 October 2023: 1,272,116,196) ordinary shares, being the weighted average number of ordinary shares in issue excluding treasury shares during the period.

 

 

The return per share detailed above can be further analysed between revenue and capital, as below.

 



(Unaudited)

Half-year ended

30 April 2024

£'000

(Unaudited)

 Half-year ended

30 April 2023

£'000

(Audited)

Year ended

31 October 2023

£'000


Revenue profit

15,941

16,543

34,568


Capital profit

173,724

89,775

29,989



------------

------------

------------


Total profit

189,665

106,318

64,557



=======

=======

=======


Weighted average number of ordinary shares

in issue during each period

1,214,507,013

1,286,965,652

1,272,116,196


Revenue earnings per ordinary share

1.31p

1.29p

2.72p


Capital earnings per ordinary share

14.31p

6.97p

2.35p



------------

------------

------------


Total earnings per ordinary share

15.62p

8.26p

5.07p



=======

=======

=======














 

4.

Current asset investment

The Company has a holding in the Deutsche Bank Global Liquidity Series Fund, a money market fund which is viewed as a readily disposable store of value and which is used to invest cash balances that would otherwise be placed on short-term deposit. At 30 April 2024 this holding had a value of £21,509,000 (30 April 2023: £26,353,000; 31 October 2023: £13,116,000).

 

 

5.

Share capital

 

At 30 April 2024 there were 1,315,102,830 ordinary shares of 2.5p each in issue of which 130,619,544 were held in treasury (with no voting rights) (30 April 2023: 1,315,102,830 of which 44,332,551 shares were held in treasury; 31 October 2023: 1,315,102,830 of which 80,870,553 shares were held in treasury). During the half-year ended 30 April 2024, 49,748,991 shares were bought back into treasury at a total cost of £53,389,000 (half year to 30 April 2023: 24,080,927 shares were bought back into treasury for a total cost of £24,881,000; year to 31 October 2023: 60,618,929 shares were bought back into treasury for a total cost of £60,484,000). Since the period end, the Company has bought back 11,181,474 shares for a total cost of £12,625,000.

 

6.

Net asset value per ordinary share

 

The net asset value per ordinary share is based on the net assets attributable to equity shareholders of £1,453,594,000 (30 April 2023: £1,426,568,000; 31 October 2023: £1,333,523,000) and on 1,184,483,286

(30 April 2023: 1,270,770,279; 31 October 2023: 1,234,232,277) ordinary shares, being the number of ordinary shares in issue with voting rights at the period end.

 

7.

Bank loan

 

The Company's multi-currency loan facility with SMBC Bank International plc expired on 1 March 2024 and has not been renewed.

 

8.

Related party transactions

 

The Company's transactions with related parties during the period were with its Directors and Janus Henderson.  There have been no material transactions between the Company and its Directors during the period other than the amounts paid to them in respect of Directors' remuneration for which there were no outstanding amounts payable at the period end.

 

In relation to the provision of services by Janus Henderson, other than fees payable by the Company in the ordinary course of business and the provision of marketing services, there have been no transactions with Janus Henderson affecting the financial position or performance of the Company during the period under review.

 

9.

Financial instruments

 

At the period end the carrying value of financial assets approximates their fair value.

 

Financial instruments carried at fair value

Fair value hierarchy

The debenture stock and unsecured loan notes are valued at par in the Statement of Financial Position. The fair value of the 8% debenture stock at 30 April 2024 was £n/a (30 April 2023: £15,224,000; 31 October 2023: £n/a). The fair value of the debenture stock was calculated using prices quoted on the exchange on which the instrument trades and was categorised as Level 1 as described below.

 

The fair value of the loan notes at 30 April 2024 has been estimated to be £91,757,000 (30 April 2023: £94,815,000; 31 October 2023: £88,985,000) and is categorised as level 3 in the fair value hierarchy as described below. This has been reflected in the daily NAV announcements since January 2024.  Previously the unsecured loan notes were valued at amortised cost in the fair value NAV.                                  

                                               

The following table analyses recurring fair value measurements for financial assets. These fair value measurements are categorised into different levels in the fair value hierarchy based on the inputs to valuation techniques used.

 


 

Financial assets at fair value through profit or loss at 30 April 2024 (Unaudited)

Level 1

£'000

Level 2

£'000

Level 3

£'000

Total

£'000

 

Investments including derivatives:





 

- Equity investments

1,530,994

-

-

1,530,994

 

- Fixed interest investments

-

-

-

-

 

- Current asset investments

21,509

-

-

21,509

 


--------------

---------

--------

--------------

 

Total financial assets carried at fair value

1,552,503

-

-

1,552,503

 


========

=====

====

========

 


 

 

 

 

 

Financial assets at fair value through profit or loss at 30 April 2023 (Unaudited)

Level 1

£'000

Level 2

£'000

Level 3

£'000

Total

£'000

 

Investments including derivatives:

 

 

 

 

 

- Equity investments

1,489,862

-

-

1,489,862

 

- Fixed interest investments

-

-

-

-

 

- Current asset investments

26,353

-

-

26,353

 


--------------

---------

--------

--------------

 

Total financial assets carried at fair value

1,516,215

-

-

1,516,215

 


========

=====

====

========

 

 

 





 

Financial assets at fair value through profit or loss at 31 October 2023 (Unaudited)

Level 1

£'000

Level 2

£'000

Level 3

£'000

Total

£'000

 

Investments including derivatives:





 

- Equity investments

1,428,787

-

-

1,428,787

 

- Fixed interest investments

-

-

-

-

 

- Current asset investments

13,116

-

-

13,116

 


--------------

---------

--------

--------------

 

Total financial assets carried at fair value

1,441,903

-

-

1,441,903

 


========

=====

====

========

 

 

Level 3 investments at fair value through profit or loss

(Unaudited)

Half-year ended

30 April 2024

£'000

(Unaudited)

Half-year

ended

30 April 2023

£'000

(Audited)

Year ended

31 October 2023

£'000

 

 



Opening balance

-

1

-

Disposal proceeds

-

(1)

-

 

   ------

   ------

  ------

Closing balance

-

-

-

 

====

====

====

 




 

10.

Reconciliation of liabilities arising from financing activities

 

 

 

            Non-cash changes

 

 

 

At

1 November

2023

£'000

Cash

flows

£'000

Amortisation

of issue costs

£'000

Foreign

exchange

£'000

At

30 April

2024

£'000

 

 

 

 

 

 

 

 

 Financing activities

 





 

 Financing liabilities

124,900

-

14

(755)

124,159

 

 

-----------

-------

--------

---------

------------

 

Closing liabilities from

financing activities

124,900

-

14

(755)

124,159

 

 

=======

====

====

=====

=======

 

 

 

 

 

 

            Non-cash changes

 

 

 

At

1 November

2022

£'000

Cash

flows

£'000

Amortisation

of issue costs

£'000

Foreign

exchange

£'000

At

30 April

2023

£'000









 Financing activities







 Financing liabilities

139,280

-

12

1,036

140,328


 

-----------

-------

--------

---------

------------


Closing liabilities from

financing activities

139,280

-

12

1,036

140,328



=======

====

====

=====

=======

 

 

 

 

 

 

            Non-cash changes

 



At

1 November

2022

£'000

Cash

flows

£'000

Amortisation

of issue costs

£'000

Foreign

exchange

£'000

At

31 October 2023

£'000









 Financing activities







 Financing liabilities

139,280

(15,000)

62

558

124,900



----------

-----------

--------

---------

------------


Closing liabilities from

financing activities

139,280

(15,000)

62

558

124,900



======

=======

====

=====

======

11.

Going concern

 

In assessing the Company's going concern, the Directors have considered among other things, cash flow forecasts, a review of covenant compliance including the headroom above the most restrictive covenants, an assessment of the liquidity of the portfolio and the impact of the war in Ukraine and the Gaza-Israel conflict. The assets of the Company consist mainly of securities that are listed and readily realisable. Thus, after making due enquiry, the Directors believe that the Company has adequate financial resources to meet its financial obligations, including the repayment of any borrowings, and to continue in operational existence for at least 12 months from the date of approval of the financial statements. Accordingly, the Directors continue to adopt the going concern basis in preparing the financial statements.

 

12.

 

Dividends

 

A first interim dividend of 0.672p (2023: 0.62p) per ordinary share was paid on 31 May 2024 to shareholders registered on 26 April 2024. The shares were quoted ex-dividend on 25 April 2024. Based on the number of ordinary shares in issue at 25 April 2024 (excluding the shares held in treasury) of 1,184,483,286 the cost of this dividend was £7,960,000.

 

The Directors have declared a second interim dividend of 0.672p (2023: 0.62p) per ordinary share which will be payable on 30 August 2024 to shareholders on the register on 26 July 2024. The shares will be quoted ex-dividend on 25 July 2024. Based on the number of shares in issue, excluding shares held in treasury, at 25 June 2024 of 1,173,301,812 the cost of this dividend will be £7,885,000.

 

13.

Comparative information

 

The financial information contained in this half-year report does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. The financial information for the half-years ended 30 April 2024 and 2023 have not been audited or reviewed by the Auditor.

 

The figures and financial information for the year ended 31 October 2023 have been extracted from the latest published financial statements of the Company. These financial statements have been delivered to the Registrar of Companies and included the report of the Auditor which was unqualified and did not contain a statement under either section 498(2) or 498(3) of the Companies Act 2006. A glossary of terms and details of alternative performance measures can be found in the Annual Report for the year ended 31 October 2023.

 

14.

Half-year report

 

The half-year report will be available on the Company's website (www.bankersinvestmenttrust.com) or in hard copy from the Company's registered office. An abbreviated version of this half-year report, the 'Update', will be circulated to shareholders in early July 2024.

 

15.

General information

 

Company status

The Company is a UK domiciled investment trust company.

London Stock Exchange Daily Official List (SEDOL): BN4NDR3 / ISIN number: GB00BN4NDR39

London Stock Exchange (TIDM) Code: BNKR

New Zealand Stock Exchange Code: BIT

Global Intermediary Identification Number (GIIN): L5YVFP.99999.SL.826

Legal Entity Identifier (LEI): 213800B9YWXL3X1VMZ69

 

Registered Office

201 Bishopsgate, London EC2M 3AE.

 

Company Registration Number

UK:  00026351

NZ:  645360

 

Directors

The Directors of the Company are Simon Miller (Chair), Richard West (Senior Independent Director), Ankush Nandra (Audit & Risk Assurance Committee Chair), Hannah Philp (Marketing Committee Chair) and Charlotte Valeur.

 

Corporate Secretary

Janus Henderson Secretarial Services UK Limited, represented by Wendy King FCG.

 

Website

Details of the Company's share price and net asset value, together with general information about the Company, monthly factsheets and data, copies of announcements, reports and details of general meetings can be found at www.bankersinvestmenttrust.com.

 

50 Largest Investments

At 30 April 2024


Rank

30 Apr 2024

Rank

31 Oct 2023

Company

Country

Valuation
31 Oct

2023

£'000

Purchases

£'000

Sales proceeds

£'000

Appreciation/
(depreciation)

£'000

 Valuation
30 Apr

2024

£'000

 

1

1

Microsoft

US

57,500

-

-

6,649

64,149

 

2

5

KLA Corp

US

20,579

-

-

8,645

29,224

 

3

12

American Express

US

14,457

4,827

-

8,814

28,098

 

4

3

Accenture

US

28,251

-

-

(520)

27,731

 

5

#

Amazon

US

-

25,028

-

741

25,769

 

6

#

Alphabet

US

-

21,730

-

3,641

25,371

 

7

7

Visa

US

19,047

4,132

-

1,974

25,153

 

8

4

UnitedHealth

US

21,616

2,681

-

(2,845)

21,452

 

9

2

Apple

US

30,506

-

(8,857)

(368)

21,281

 

10

18

CME

US

12,928

8,491

-

(412)

21,007

 

11

10

Toyota Motor

Japan

16,790

-

(1,176)

5,215

20,829

 

12

11

Novo Nordisk

Denmark

15,734

-

-

4,853

20,587

 

13

#

Morgan Stanley

US

8,831

7,819

-

2,550

19,200

 

14

20

Chevron

US

12,592

5,343

-

1,105

19,040

 

15

9

TotalEnergies

France

16,810

-

-

1,075

17,885

 

16

#

Meta

US

-

15,320

-

2,009

17,329

 

17

13

McDonald's

US

13,802

3,030

-

(53)

16,779

 

18

19

Deere

US

12,667

3,115

-

530

16,312

 

19

15

Texas Instruments

US

13,412

-

-

2,722

16,134

 

20

21

Oracle

US

12,288

1,269

-

861

14,418

 

21

#

ASML

Netherlands

8,770

1,731

-

3,883

14,384

 

22

47

BP

UK

9,198

4,651

(832)

884

13,901

 

23

17

Procter & Gamble

US

13,092

-

-

710

13,802

 

24

37

Starbucks

US

9,785

4,476

-

(940)

13,321

 

25

8

AstraZeneca

UK

17,286

-

(6,140)

2,172

13,318

 

26

40

Marriott

US

9,608

1,620

-

2,059

13,287

 

27

32

Lloyds Banking

UK

10,370

438

(773)

3,153

13,188

 

28

#

Lam Research

US

8,660

298

-

4,181

13,139

 

29

41

Eli Lilly

US

9,556

-

-

3,509

13,065

 


50 Largest Investments continued

At 30 April 2024

 

 

 

 

 

 

Rank

30 Apr 2024

Rank

31 Oct 2023

Company

Country

Valuation
31 Oct

2023

£'000

Purchases

£'000

Sales proceeds

£'000

Appreciation/
(depreciation)

£'000

Valuation
30 Apr

2024

£'000

30

#

Hershey

US

7,789

5,021

-

145

12,955

31

33

Hitachi

Japan

10,313

-

(2,309)

4,435

12,439

32

28

Nike

US

10,765

3,233

-

(1,656)

12,342

33

#

Daiichi Sankyo

Japan

8,892

1,228

(755)

2,738

12,103

34

27

Abbott Laboratories

US

11,026

114

-

956

12,096

35

#

Constellation Brands

US

4,707

6,778

-

471

11,956

36

#

Marsh & McLennan

US

6,101

5,290

-

401

11,792

37

#

Broadcom

US

7,203

801

-

3,620

11,624

38

29

Shin-Etsu Chemical                      

Japan

10,628

-

(2,251)

3,034

11,411

39

43

Safran

France

9,490

-

(1,524)

3,435

11,401

40

#

Unicredit

Italy

7,812

-

-

3,379

11,191

41

#

Taiwan Semiconductor Manufacturing

Taiwan

8,214

-

(1,094)

4,048

11,168

42

35

Honeywell

US

9,925

1,035

-

143

11,103

43

30

Sanofi

France

10,419

-

-

669

11,088

44

#

Samsung Electronics

South Korea

6,752

6,613

(3,194)

820

10,991

45

44

SAP

Germany

9,364

-

(1,528)

2,949

10,785

46

42

Sumitomo Mitsui

Japan

9,538

755

(1,091)

1,493

10,695

47

#

IBM

US

6,998

2,726

-

641

10,365

48

49

AbbVie

US

9,136

-

-

1,061

10,197

49

48

ADP

US

9,158

298

-

694

10,150

50

#

Siemens

Denmark

-

10,304

-

(162)

10,142

 

 

 

 

598,365

160,195

(31,524)

100,111

827,147

 

All securities are equity investments

# Not in top 50 at 31 October 2023

Convertibles and all classes of equity in any one company are treated as one investment

 

 

REVENUE GENERATED

 


30 April 2024

£million

30 April 2023

£million

UK

4.4

4.7

Europe (ex UK)

3.5

3.1

North America

5.6

5.4

Japan

2.2

2.4

Pacific (ex Japan and China)

2.8

3.4

China

0.3

0.1

Emerging Markets

0.3

-


---------

---------


19.1

19.1


=====

=====

Source: Janus Henderson

 


 

 

GEOGRAPHICAL ANALYSIS

Equities excluding cash held

 

            Valuation of investments


30 April 2024

%

31 October 2023

%

UK

13.9

15.1

Europe (ex UK)

17.1

16.7

North America

42.4

40.2

Japan

13.1

13.1

Pacific (ex Japan and China)

7.6

9.9

China

4.6

5.0

Emerging Markets

1.3

-


---------

---------


100.0

100.0


=====

=====

Source: Janus Henderson

 

 


 

SECTOR ANALYSIS

As a percentage of the investment portfolio excluding cash


30 April 2024

%

31 October 2023

%

Technology

22.3

16.3

Financials

19.4

16.9

Consumer Discretionary

15.7

16.0

Industrials

14.4

17.2

Health Care

10.9

12.6

Consumer Staples

7.7

9.5

Energy

3.7

3.9

Basic Materials

3.3

2.8

Utilities

1.0

1.2

Telecommunications

0.9

2.5

Real Estate

0.7

1.1


---------

---------


100.0

100.0


=====

=====

Source: Janus Henderson

 


 

 

 


Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) are incorporated into, or forms part of, this announcement.

 

*********************************

 


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