Half-yearly report Interim Results to 30 Septem...

Blue Planet Financials Growth & Income Investment Trusts No's 1-10 Plc Interim Results For the six months ended 30 September 2007 Blue Planet Financials Growth and Income Investment Trusts plc Blue Planet Financials Growth and Income Investment Trust No 1 plc (Registered Number 162796) Blue Planet Financials Growth and Income Investment Trust No 2 plc (Registered Number 162797) Blue Planet Financials Growth and Income Investment Trust No 3 plc (Registered Number 162798) Blue Planet Financials Growth and Income Investment Trust No 4 plc (Registered Number 162799) Blue Planet Financials Growth and Income Investment Trust No 5 plc (Registered Number 162800) Blue Planet Financials Growth and Income Investment Trust No 6 plc (Registered Number 162801) Blue Planet Financials Growth and Income Investment Trust No 7 plc (Registered Number 162802) Blue Planet Financials Growth and Income Investment Trust No 8 plc (Registered Number 162803) Blue Planet Financials Growth and Income Investment Trust No 9 plc (Registered Number 162804) Blue Planet Financials Growth and Income Investment Trust No 10 plc (Registered Number 162805) Each of the investment trusts is a separate limited company, but otherwise they are to all intents and purposes identical. The information contained in this Interim Report, including the financial statements, applies equally to each of the ten Blue Planet Financials Growth and Income Investment Trusts (the "Trusts"), and reference to the "Company" shall be deemed to be a reference to each of them. Trading in the shares and warrants of the Trusts The Trusts' shares and warrants can be traded in share or warrant units. Each unit comprises 10 shares or warrants, 1 in each of the 10 trusts. It is generally cheaper for investors to trade in the units rather than the underlying shares or warrants. Officers and Advisors Directors Investment Manager Victoria W Killay (Non-Executive Chairman) Blue Planet Investment Management Ltd Kenneth Murray (Non-Executive) Greenside House Dr Michael Shea (Non-Executive) 25 Greenside Place Edinburgh EH1 3AA Telephone No: +44 131 466 6666 Facsimile No: + 44 131 466 6677 e-mail: info@blueplanet.eu www.blueplanet.eu Secretary and Registered Office Registrars Blue Planet Investment Management Ltd Capita Registrars Greenside House Northern House 25 Greenside Place Woodsome Park Edinburgh EH1 3AA Fenay Bridge Telephone No: +44 131 466 6666 Huddersfield HD8 0LA Facsimile No: +44 131 466 6677 Shareholder Helpline No. +44 870 162 3131 e-mail: info@blueplanet.eu e-mail: ssd@capitaregistrars.com www.blueplanet.eu www.capitaregistrars.com Auditors Bankers Deloitte & Touche LLP Lloyds TSB Scotland Plc Saltire Court Henry Duncan House 20 Castle Terrace 120 George Street Edinburgh EH1 2DB Edinburgh EH2 4LH Stockbroker Custodians Fairfax Plc RBC Dexia Investor Services Trust 46 Berkeley Square, Mayfair 71 Queen Victoria Street London WIJ 5AT London EC4V 4DE Blue Planet Investment Management Ltd is authorised and regulated by the Financial Services Authority. Blue Planet Financials Growth and Income Investment Trust No.1-10 plc are members of the Association of Investment Companies. Financial Record Investment Policy The investment policy of the Company is to invest in securities (as defined by the Financial Services & Markets Act 2000), including shares and bonds, issued by financial companies located anywhere in the World. Investment Objective The investment objective of the Company is to produce a total return greater then the Bloomberg World Financials Index. Financial Record Six months ended Six months ended Year ended 30 September 2007 30 September 2006 31 March 2007 Shareholders' funds (£'000) 3,748 3,814 4,477 Net asset value per share (p)# 27.45 28.00 32.86 Share price (p) (Bid)# 18.5 17.6 23.0 Discount (%) 32.6 37.1 30.0 Gearing (%)* 11.1 47.4 28.9 Revenue available for shareholders (£'000)# (5) 42 0 Revenue return per share (p)# (0.04) 0.31 0.00 Total return per share (p)# (5.37) (0.70) 4.18 Total return on BBG World financial Index (%) 1% (0.58%) (1.0%) * Net debt as a percentage of shareholders' funds # Comparative per share data has been adjusted to reflect the 10 for 1 share split approved by shareholders on 2 August 2006. See note 4 on page 13. Dividend No interim dividend has been declared. Capital Gains Tax Apportionment for capital gains tax between ordinary shares and warrants based on mid-market prices on the first day of dealings (25 April 1996) in the ordinary shares and the warrants: Each ordinary share 9.524p Each warrant 23.80p The Investment Manager Blue Planet Investment Management Ltd is an Edinburgh based investment management Company which specialises in managing investments in financial companies. Its corporate philosophy is that consistent out-performance is more likely to be achieved by specialisation than it is from the generalist approach, which currently prevails across most of the fund management industry. Stock markets comprise of many sectors, which are represented in general stock market indices, such as the S&P500, FTSE All Share, FTSEurofirst 300, Nikkei 225 etc. However, many of these sectors are in economic decline and will produce below average returns to investors in the future. Blue Planet believes that investors should only invest in those sectors that have superior long-term economic prospects and, crucially, which are undervalued. It believes that the World's financial sector is one such sector. By concentrating only on those sectors and by using the services of expert fund managers who specialise in those sectors investors should maximise their likelihood of consistent out-performance. By focusing on only one sector Blue Planet believes that it is able to develop a level of expertise and understanding of that sector that generalist fund managers cannot. It believes that this greater expertise and understanding will allow it to produce better, more consistent investment returns for its clients than generalist fund managers. It is widely accepted in most walks of life that specialisation leads to better results than generalisation. Blue Planet believes that in future pension funds and others will increasingly use specialist advisors to advise them specifically and solely on the allocation of their assets across sectors and will then place the designated funds with specialist investment managers in those sectors. This segregation of roles and increased specialisation will, it believes, reduce conflicts of interest and lead to better investment performance. Blue Planet Investment Management Ltd is the investment manager of the company and receives an annual fee of 1.50% per annum of the total assets of the company which is paid monthly. Blue Planet Investment Management Ltd. also receives £7,500 per annum in respect of administration and secretarial services. In addition to Blue Planet Financials Growth & Income Investment Trusts Nos. 1-10, Blue Planet Investment Management Ltd also manages the Blue Planet Worldwide Financials Investment Trust plc, the Blue Planet European Financials Investment Trust plc and the Blue Planet Global Financials Fund. Details of Blue Planet's Savings Plan, investment trusts and other products can be found on its website, www.blueplanet.eu. Alternatively, they may be obtained from Blue Planet Investment Management Ltd, Greenside House, 25 Greenside Place, Edinburgh, EH1 3AA (Tel no: +44 131 466 6666). Website Information Please take the time to visit our website: www.blueplanet.eu If you wish to receive a monthly fact sheet on the trusts please visit: http://www.blueplanet.eu/blueplanet_downloads.136.html To download historical Annual and Interim reports and past monthly fund fact sheets: http://www.blueplanet.eu/ blueplanet_downloads.124.html Chairman's Statement Performance The past year has been an erratic one in the stock markets. A year ago the share price of your Fund's Share Unit was 176.0p per share. We ended this interim period with a Share Unit price of 185.0p, a rise of 5.1% over the year. However over the six month period the share price has fallen by 19.6%. The Fund's share price total return over three years is 102.4%. The net asset value ("NAV") of your Fund has fallen 2.0% for the year to 30th September 2007, compared to its benchmark index total return of 6.0%. For the six month period the NAV has fallen 16.5%, where the benchmark has risen by 1.0%. This is due to our positioning ourselves for a bear market while stocks continued to rise. The Fund's NAV per Unit reached a value of 373.6p towards the end of February 2007, prior to the Fund's financial year end in March. A sharp sell-off occurred in the markets at the end of February and the start of March 2007. The gearing in your Fund had been reduced in anticipation of problems in the market due to the climate of rising interest rates and early warning signs of problems in the property and unsecured lending sectors in the US and the UK, however this did not stop the correction from having an adverse affect on your Fund's NAV and share price. It remained positioned for a downturn in the markets as we anticipated that the US sub-prime problem would filter through to the mainstream economy. However, markets rose, which meant your Fund, to a large extent, missed out on the recovery that took place through April, May and June, but was hit by the very sharp correction, that impacted financial stocks in particular, in July and August. Portfolio Figure 1 shows the geographic movements of the portfolio over the six month interim reporting period. We ended the period with a concentrated portfolio of strongly performing banks. They are all producing excellent results. The banks which report interim results have now issued first half of 2007 statements and across our holdings on average net income at the banks increased 59% at the end of the first half of 2007 compared to a year ago. All have indicated that they have good prospects for the remainder of 2007. With regards to geographic distribution, we continue to have a sizeable proportion of the fund invested in Central and Eastern Europe. Our two key markets in this region at the end of the interim period were Russia and Poland. The Investment Manager visited Russia most recently in July 2007 and met with a number of banks. These banks all reported that business was booming. Most banks are focusing on the very rapid growth in retail banking. In 2006 corporate lending was growing at a rate of 30% per annum and retail loans at 80%. The macroeconomic background in Russia remains strong. It has a large and very asset rich land mass, commodity prices are high, it has huge foreign exchange reserves, and there has been a significant increase in real household income. At the end of the interim period we held investments in four Russian banks. The Company reduced the number of investments in Poland during 2007. The economic conditions remain very strong. Poland's GDP growth was 6.1% in 2006 and in the first half of 2007 growth stood at 6.7% year-on-year. This means that GDP growth is expected to exceed this year's target of 6.0% growth. It is being driven by strong domestic demand and rising business confidence. However, to reduce gearing in the Fund profits were taken in Bank Przemyslowo-Handlowy and the size of the holding in Bank Zachodni, was reduced. At the end of the interim period we remained invested in Bank Millenium. Your Company continued to invest in South Eastern Europe. The existing investment in Greece remains in place, although it has been reduced in size to help cut the Fund's overall gearing. The investment in Bank of Cyprus was sold. Greece had GDP growth in 2006 of approximately 4% and a banking sector that is expanding rapidly. A small investment was made in India during the period, following an investment research trip to the country. India has significant growth potential. In April 2007 the Reserve Bank of India forecast GDP growth of 8.5% for 2007. Indian banks are growing at a fast pace. Results for the period April to June 2007 showed the largest 30 banks in India saw a 41% growth in profits year-on-year. We believe that India will present a number of excellent long-term investment opportunities, and an initial investment has been made in Federal Bank. Your Fund sold out of its investments in Brazil and Denmark. These holdings were in the portfolio at the Company's last year end, but were already in the process of being sold down. A number of the investments in place at the end of this interim period are designed to shield the portfolio against stock market falls. The investments in the UK are in money market liquidity funds. These mutual funds provide a good rate of income and the short-term debt paper they are invested in provides a safe-haven for cash in the current market conditions. The Fund remains invested in Blue Planet's Global Financials Fund, listed in Dublin, although the size of the holding was reduced at the end of August 2007. A key motivation for this investment is protection against falling stock markets. The investment classified as a "European" investment is a Future contract on the DJ Eurostoxx index. This is being used as a hedge. Warrants The bid price of our Warrant units fell by 26.6% to 1200p over the six months to 30th September 2007. Over the full year the Warrant units' bid price has increased by 25.0%. Following the 10 for 1 share split in August 2006, each warrant unit now entitles the holder to subscribe for 10 Ordinary Shares at an exercise price of 10 pence each. The warrants remain valid until 2010. Borrowings and Gearing At the half year end the Fund had gearing of 11.1% compared to gearing of 28.9% at the end of March 2007. The gearing level in the Fund is monitored closely and gearing can be significantly reduced if weak market conditions are anticipated, as is currently the case. A small amount of gearing remains due to the cost of shutting down all of the Fund's loan facilities. Generally gearing beneficially affects the Company's NAV when the value of its investments is rising, but adversely affects it in periods when the value of investments is falling. In the erratic market conditions over the past six months the gearing level has averaged approximately 16% through the period. The Company's unsecured term loans total £3.25m. This is a significant increase from the £1.925m loan facility in place at the end of the last period. The undrawn portion of the loans remain available to be utilised at any time when the Manager believes that the markets have settled down and it is time to increase investments again. Dividend No interim dividend has been declared for the first half of the year. Investment income has been low for the first half of the Fund's financial year, largely due to the selling down of investments to remove gearing from the Fund. This year the considerably reduced revenue income for the first half of the year, combined with quite a modest forecast for dividend income in the second half of the year, means that at the present time it seems unlikely that it will be possible to pay a full year dividend. Risk Your Company is exposed to a number of risks which are detailed in full in the Annual Report. The key market risk arises from the uncertainty regarding the future price performance of the equities held by your Company. If gearing is employed this risk is magnified. The Company is invested in a single industry sector. Being invested in a single sector exposes the Fund to the risk that the Financial Sector will under perform relative to other sectors of the market, as has been the case during this interim period. In mitigation the specialist expertise of Blue Planet Investment Management Ltd reduces risk. Blue Planet Investment Management Ltd believes that more knowledge equals less risk. The financials sector in which we are invested is the largest sector of the market and constitutes approximately a quarter of the Bloomberg World Index. Banks play a crucial and central role in free market economies; a role that will ensure the prosperity of the banking sector as a whole over time. The Fund is exposed to currency risk, due to the range of currencies in which investments are held. The majority of the Company's assets are held in securities denominated in foreign currencies and movements in these currencies can significantly affect the total return and net assets. The fund manager tracks currency movements on a regular basis and hedging is considered on a case-by-case basis. Blue Planet Services and Price Information Sources Shareholders can view the Company's share price and additional information about the Fund on the website of Blue Planet Investment Management Ltd (www.blueplanet.eu) and the London Stock Exchange (www.londonstockexchange.com). To find the Company's share price on the London Stock Exchange website go to the Home page and type "BPFU" in the "Price Search" field. Our share price is also published in the Financial Times. Blue Planet Investment Management offers a Blue Planet Saving Plan via Lloyds TSB (to be renamed Equiniti) to enable lump sum investments or regular savings. A request form for the savings plan application pack is enclosed with these accounts. Blue Planet has also arranged a stock -market dealing service via Stocktrade. Outlook We aim to anticipate movements in stock markets at all times and we believe we are now in a bear market. We expect the US economy to go into recession in 2008 and global equity markets to fall. Hence we have locked in profits we have made in recent years, by selectively selling investments. At the end of the period we had 58% of the total portfolio plus cash in equities. The remainder is in sterling liquidity funds or held as cash. The liquidity and bad debt problems and the associated slowdown in the US will affect share prices globally, despite the sharp rise in profitability of many banks. The third quarter 2007 results that are now being issued by banks worldwide show a wide divergence in performance for this accounting period. Results range from large losses brought about by massive writedowns due to exposure to the US subprime problem, to continued strong profit growth in retail banks in expanding economies. Whilst the immediate prospects are for further volatility, over time we expect markets to settle down and we are confident that the share prices of our portfolio of dynamically growing retail banks in strong economies, none of which, to the best of our knowledge, have any exposure to the US sub-prime issues, will gain rapidly as their earnings momentum is appreciated. Banks around the world continued to produce record profits and increased profitability for the fourth successive year in 2006. Aggregate pre-tax profits for the top 1000 banks in 2006 rose almost 22% to reach $786bn, more than three times the $223bn aggregate profits in 2002. The banks we are invested in increased profits (post-tax) by close to three times last year's average in the first half of 2007. We intend to use our loans and cash reserves to re-enter the market once the correction has taken place. The further the stock markets fall the greater the opportunity for us. Consequently we look forward to the future with great confidence and anticipation. I would like to thank all shareholders for their continuing support. Victoria Killay Chairman 21 November 2007 Income Statement (Unaudited) For the six months ended For the six months ended For the year ended 30 September 2007 30 September 2006 31 March 2007 Revenue Capital Total Revenue Capital Total Revenue Capital Total (£) (£) (£) (£) (£) (£) (£) (£) (£) Capital gains/(loss) on investment Net realised (losses) /gains - (589,811)(589,811) - 293,367 293,367 - 2,247,192 2,247,192 Unrealised (losses)/gains - (75,219) (75,219) - (321,791)(321,791) - (1,480,561)(1,480,561) Exchange (losses)/gains - (15,762) (15,762) - (59,773) (59,773) - ( 98,697) (98,697) Net capital gains on investment - (680,792)(680,792) - (88,197) (88,197) - 667,934 667,934 Income from investments 39,741 - 39,741 123,063 - 123,063 147,686 - 147,686 Bank interest receivable 23,475 - 23,475 3,353 - 3,353 5,889 - 5,889 Gross revenue and capital gains 63,216 (680,792) 617,576 126,416 (88,197) 38,219 153,575 667,934 821,509 Administrative expenses (44,623) (25,783) (70,406) (42,879) (23,269) (66,148)(86,228) (50,599) (136,827) Net return before interest payable and taxation 18,593 (706,575)(687,982) 83,537 (111,466)(27,929) 67,347 617,335 684,682 Interest payable (20,148) (20,148) (40,296) (25,200) (25,200)(50,400)(48,392)( 48,392) (96,658) Return on ordinary activities before taxation (1,555)(726,723)(728,278) 58,337 (136,666)(78,329) 19,018 569,006 588,024 Taxation on ordinary activities (note 3) (3,448) - - (16,260) - (16,260)(19,420) - (19,420) Return on ordinary activities after taxation (5,003)(726,723)(731,726) 42,077 (136,666)(94,589) (402) 569,006 568,604 Return per ordinary share - basic (0.04p) (5.33p) (5.37p) 0.31p (1.01p) (0.70p) 0.00 4.18p 4.18p Return per ordinary share - diluted (0.03p) (4.85p) (4.88p) 0.29p (0.93p) (0.64p) 0.00 3.82p 3.82p The Total column of the income statement represents the profit & loss account of the Company. All revenue and capital items in the above statement derive from continuing operations. There were no recognised gains and losses other than those disclosed above. Accordingly a statement of total recognised gains and losses is not required. Comparative per share data has been adjusted to reflect the 10 for 1 share split approved by shareholders on 2 August 2006. Balance Sheet (Unaudited) At 30 September At 30 September At 31 March 2007 2006 2007 (£) (£) (£) Fixed assets Equity investments 4,180,595 5,642,251 4,466,668 Current assets Debtors 7,515 10,951 1,329,402 Cash at Bank and in hand 933,680 97,625 628,964 Creditors: amounts falling due within one year (24,120) (33,022) (23,189) Net current assets 917,075 75,554 1,935,177 Total assets less current liabilities 5,097,670 5,717,805 6,401,845 Creditors: amounts falling due after more than one year (note 6) (1,349,391) (1,904,153) (1,925,000) Net assets 3,748,279 3,813,652 4,476,845 Capital and reserves Called-up share capital 136,542 136,226 136,226 Share premium account 1,178,688 1,175,092 1,175,092 Other reserves Capital reserve - realised 2,321,916 1,073,496 2,956,042 Capital reserve - unrealised 29,610 1,299,081 122,207 Capital redemption reserve 8,450 8,450 8,450 Warrant reserve 60,058 60,810 60,810 Revenue reserve 13,015 60,497 18,018 Shareholders' funds 3,748,279 3,813,652 4,476,845 Net asset value per ordinary share - basic (note 4) 27.45 28.00p 32.86p Net asset value per ordinary share - diluted (note 4) 24.73 25.15p 29.25 Comparative per share data has been adjusted to reflect the 10 for 1 share split approved by shareholders on 2 August 2006. On behalf of the Board Victoria W Killay Chairman 21 November 2007 Cash Flow Statement (Unaudited) For the six months For the six months For the year ended ended ended 30 September 2007 30 September 2006 31 March 2007 (£) (£) (£) Operating activities Investment income received 35,131 110,657 132,534 Interest received 23,289 3,340 5,889 Investment management and administration fees paid (49,261) (32,550) (90,283) Cash paid to and on behalf of directors (2,200) (2,620) (4,820) Other cash payments (25,295) (20,621) (38,337) Net cash (outflow)/inflow from operating activities (note 5) (18,336) 58,206 4,983 Servicing of finance Interest paid (37,254) (50,293) (95,450) Taxation Taxation recovered 886 2,571 3,819 Capital expenditure and financial investment Purchase of investments (5,939,959) (1,820,568) (6,459,693) Sale of investments 6,887,590 1,873,514 7,159,187 Cash outflow before use of liquid resources and financing 892,927 63,430 612,846 Management of liquid resources Cash placed on deposit (606,482) (34,938) - Financing Net proceeds from share issue 3,160 4,130 4,130 Repayment of Loan (597,939) - - Loan advanced - - (18,278) Increase / (Decrease) in cash (308,334) 32,622 598,698 Reconciliation of Movements in Shareholders' Funds (Unaudited) Share Share Capital Capital Capital Warrant Revenue Total capital premium redemption reserve- reserve- reserve reserve shareholders' realised unrealised funds £ £ £ £ £ £ £ £ For the six months ended 30 September 2007 Shareholders' funds at 1 April 2007 136,226 1,175,092 8,450 2,956,042 122,207 60,810 18,018 4,476,845 Proceed of share issue 316 2,844 - - - - - 3,160 Transfer from warrant reserve - 752 - - - (752) - - Return on ordinary activities after taxation - - - (634,126) (92,597) - (5,003) (731,726) Shareholders' funds at 30 September 2007 136,542 1,178,688 8,450 2,321,916 29,610 60,058 13,015 3,748,279 For the six months ended 30 September 2006 Shareholders' funds at 1 April 2006 135,850 1,170,956 8,450 906,475 1,602,768 61,920 17,692 3,904,111 Proceed of share issue 376 3,476 - - - - 728 4,580 Expense of share issue - (450) - - - - - (450) Transfer from warrant reserve - 1,110 - - - (1,110) - - Return on ordinary activities after taxation - - - 167,021 (303,687) - 42,077 (94,589) Shareholders' funds at 30 September 2006 136,226 1,175,092 8,450 1,073,496 1,299,081 60,810 60,497 3,813,652 For the year ended 31 March 2007 Shareholders' funds at 1 April 2006 135,850 1,170,956 8,450 906,475 1,602,768 61,920 17,692 3,904,111 Proceed of share issue 376 3,476 - - - - 728 4,580 Expense of share issue - (450) - - - - - (450) Transfer from warrant reserve - 1,110 - - - (1,110) - - Return on ordinary activities after taxation - - - 2,049,567 (1,480,561) - (402) 568,604 Shareholders' funds at 31 March 2007 136,226 1,175,092 8,450 2,956,042 122,207 60,810 18,018 4,476,845 Notes 1. The financial statements for the six months to 30 September 2007 have been prepared on the basis of the accounting policies set out in the Company's Annual Reports and Accounts as at 31 March 2007 in accordance with the statement on interim financial reporting issued by the ASB and applicable to UK law and accounting standards. 2. All expenses are charged to the revenue account with the exception of management fees and interest charges on borrowings, one half of which less the appropriate tax relief is charged to capital. 3. The taxation charge arises wholly from overseas withholding tax on investment income. 4. The return per ordinary share is based upon the following figures: 30 Sept 2007 30 Sept 2006 31 Mar 2007 Revenue return (£) (5,003) 42,077 (402) Capital return (£) (726,723) (136,666) 569,006 Weighted average number of ordinary shares in issue during the period - basic 13,633,018 13,592,151 13,607,375 Weighted average number of ordinary shares in issue during the period - diluted 14,991,359 14,622,494 14,880,840 At the Annual General Meeting on 2 August 2006 shareholders approved the subdivision of the Companies ordinary shares by way of a ten for one share split such that the 1,362,260 existing ordinary shares of 10p each were divided into 13,622,600 new ordinary shares of 1p each. Comparative per share data in this interim report has been adjusted to reflect this split. At 1 April 2007 the Company had 255,590 warrants in issue. On 31 July 2007 3,160 warrants were exercised leaving 252,430 warrants in issue. After the approval of the subdivision on 2 August 2006, each warrant now confers the right, exercisable normally on 31 July in any of the years from 2007 to 2010 inclusive, to subscribe for ten new ordinary shares at a price of 10p per share. The net asset value per ordinary share is calculated on the 13,654,200 ordinary shares in issue at the end of the period. Net asset dilution arises from the potential exercise of outstanding warrants and is assumed only to take place if the net asset value per share exceeds the exercise price of £0.10. 5. Cash Flow Statement 30 Sept 2007 30 Sept 2006 31 Mar 2007 Reconciliation of net £ £ £ revenue return to net cash inflow from operating activities£ Net return before interest payable and taxation 18,593 83,537 67,347 Administrative expenses charged to Capital (25,783) (23,269) (50,599) Decrease/(increase) in other debtors (5,583) 725 4,814 Increase/(decrease) in other creditors (2,117) 14,448 3,515 Tax suffered on investment income (3,449) (17,235) (20,094) Net cash (outflow)/inflow from operating activities (18,336) 58,206 4,983 Reconciliation of net cash flow 30 Sept 2007 30 Sept 2006 31 Mar 2007 to movement in net debt £ £ £ Increase in cash balances (308,334) 32,622 598,698 Cash placed on deposit 606,482 34,938 - Repayment of loan 597,939 - - Loan advanced - - 18,278 Changes in net debt resulting from cash flows 896,087 67,560 616,976 Exchange differences (15,762) (59,773) (98,697) Movement in net debt in the period to 30 September 2007 880,325 7,787 518,279 6. The loans are subject to a covenant which sets a maximum gearing threshold. Details of the loans outstanding at 30 September 2007 were as follows: Amount (£) Interest Rate (%) Repayment Date Sterling Loan 750,000 6.75523 23 January 2012 Euro Loan 599,391 4.86000 23 January 2012 7. At 30 September 2007 the Company had authority to buy back 2,000,000 of its own shares in accordance with the authority granted at the Annual General Meeting on 31 July 2007. No shares were bought back during the period under review. 8. The figures and financial information for the year ended 31 March 2007 are extracted from the latest published accounts of the Company and do not constitute statutory accounts for the period as defined in section 240 of the Companies Act 1985. Those accounts have been delivered to the Registrar of Companies and include the report of the auditors which was unqualified and did not contain a statement either under section 237(2) or 237(3) of the Companies Act 1985. Portfolio Information At 30 September 2007 Valuation (£) % of portfolio Equities 861613 URSA Bank 808,058 19.3 600000 Abbey Sterling Liquidity Fund 600,000 14.4 600000 Morley Sterling Liquidity Fund 600,000 14.4 9798.882 BP Global Financials - A Class 520,858 12.4 217469 Bank Millennium SA 472,809 11.3 583197 Bank VTB North-West 464,336 11.1 9763 Bank Zachodni WBK SA 454,846 10.9 8442 Piraeus Bank S.A. 147,095 3.5 2479 Bank Vozrozhdenie 64,783 1.6 12682 Federal Bank Ltd - IPC 57,958 1.4 5201492 Ural-Siberian Bank 56,150 1.3 62 DJ Eurostoxx 50 Future Dec07 -66,297 -1.6 Total 4,180,595 100.0 Geographical Regions Russia 1,393,326 33.3 United Kingdom 1,200,000 28.7 Poland 927,655 22.2 Ireland 520,858 12.5 Greece 147,095 3.5 India 57,958 1.4 Europe -66,297 -1.6 Total 4,180,595 100.0 The above figures relate to the No. 1 Trust but all 10 Trusts are identical. A unit comprises ten shares, one share in each of the Blue Planet Financials Growth & Income Investment Trusts Nos 1-10. For more information, please visit www.blueplanet.eu You can also contact the Company on 0131 466 6666 or by emailing info@blueplanet.eu END
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