Annual Financial Report

RNS Number : 3190F

Hansa Trust PLC

14 June 2012

 



HANSA TRUST PLC

Preliminary Announcement of Unaudited Results

for the year ended 31 March 2012

Hansa Trust PLC announces its Preliminary Results for the year ended 31 March 2012

Financial Highlights	Year ended 31 March 2012 (unaudited)	Year ended 31 March 2011
Net Asset Value - Total Return	1.8%	23.3%
Performance Benchmark	4.4%	5.3%
Capital return per equity share	5.8p	204.6p
Revenue return per share	14.7p	3.5p
Net asset value per share	1,117.5p	1,100.5p
Total dividend per equity share for the year	14.0p	3.5p
Total income (£000's)	6,049	3,009
Revenue before taxation (£000's)	3,529	836

The following are attached:

·          Chairman's Statement

·          Group Income Statement

·          Statement of Changes in Equity-Group and Company

·          Balance Sheet for the Group and Company

·          Cash Flow Statement

·          Notes

For further information, please contact:

Peter Gardner               Hansa Capital Partners LLP                  020 7647 5750

Chairman's Statement

2011-2012: MORE STOCK MARKET UNCERTAINTY

Our  year  to  31  March  2012  was  not  a  good  year  for  most stock  markets  around  the  world,  albeit  the  UK's  stock markets  were  better  than  many,  falling  rather  less  than others  around  the  world.  The  plight  of  the  Euro  and  the Eurozone's banks and the inflationary concerns of emerging market  economies  meant  that  European  and  BRIC  stock markets  performed  poorly  (France  -14%,  Germany  -1%, China  -23%  and  Brazil  -6%);  led  by  the  stock  markets  of the United States (USA +6% and Japan +3%), other markets performed rather better. It was a mixed bag. The UK's FTSE All‑share  Index  (the  Index  for  the  biggest  companies)  fell 2%  but  the  AIM  index  (the  smallest  companies)  fell  12%. By  and  large  the  perceived  safety  of  large  companies meant  broad  based  indices  fared  better. Whether or not individual markets made positive progress, there remained an undertone of concern everywhere.

THE YEAR'S RESULTS

NAV: +1.6% to 1,117.5p per share

Benchmark: +4.4%

In a difficult year for the stock market, the net asset value ("NAV") rose by 17p (having paid an interim dividend of 3.5p) or 1.6% over the course of the year, ending up at 1,117.5p per ordinary and "A" ordinary share. Our  absolute  return  benchmark,  returned 4.4%  but  the  FTSE  All‑share  Index  fell  by  2.1%.  It  is  the nature of having an absolute benchmark for comparative purposes  that  it  will  grind  out  steady  returns  each  and every  year  whereas  an  equity  benchmark,  being  volatile, won't. But it is our primary purpose to make money (i.e. make an absolute return) for shareholders so that an absolute return benchmark is appropriate to the Company's objective; this year we underperformed our benchmark even if we outperformed the market itself.  As has been the case in many years past, the greatest contribution came from our holding in Ocean Wilsons.  It should be noted however that the balance of the portfolio also made a positive contribution with particularly good ones coming from NCC Group and Hargreaves Services. Suffice it to say that the Hansa Capital team, William Salomon, John Alexander, Peter Gardner and their colleagues continue to serve the Company well and on behalf of shareholders I would once again like to thank them for their efforts. Thank you.

OCEAN WILSONS

Value of Holding: +3.5% at £109.9m.

In November 2011, the Board, accompanied by John Alexander, spent a week in Brazil visiting the facilities of Ocean Wilsons' 58% owned subsidiary, Wilson Sons. Given that our holding accounts for circa 40% (41% at the year-end) of our NAV, it is encumbered upon the Directors to have a thorough understanding of Ocean Wilsons' business. We visited facilities in or near Rio de Janeiro, Sao Paulo, Porte Allegro and Rio Grande involved in container terminals, shipyards, towage and offshore oil drilling services. We added to our knowledge of the different businesses in Wilson Sons and of Brazil itself. Most important of all we met a lot of senior management by whom we were impressed; indeed Wilson Sons has a reputation within its industry for good management. While we will not be going to Brazil every year, we will make periodic visits so that we can continue to keep pace with developments and, as directors, have our own independent views of the company.

Our journey to Brazil served not only to enlighten us about Wilsons Sons but also and importantly about Brazil itself. There is no doubt that it is an exciting place to visit and there was a positive and optimistic feeling about the country's future wherever we went. Brazil is the 5th largest country by land mass and by population, enjoys the benefits of quite low population density, has a relatively young population but has an emerging middle class with spending power and has an economy that is roughly the same size as that of the UK. It is blessed with an abundance of raw materials, particularly iron ore and is one of the most important producers of food in the world. It has a lot going for it.

There are, as with all countries, a number of negatives and Brazil has them too. Its savings rate (less than 20%) is too low for an emerging market economy, its education is poor, its infrastructure is awful and its bureaucracy and corruption suffocate enterprise.  As a consequence whenever the economy's growth rate picks up, inflation kicks in quite quickly.  But these problems are recognised - to a greater or lesser extent - and they themselves create an opportunity for improvement.  With the football World Cup (2014) and the Olympics (2016) coming along and the emergence of Brazil as one of the largest producers of oil and gas in the world, there are plenty of opportunities for the country to develop itself, its economy and its people.

Quite separately, the Board meets annually with Ocean Wilsons' investment managers and reviews the progress of the investment portfolio; it stood at circa US$235.5 million at 30 April 2012. It is essentially a long-term portfolio with some exciting long-term prospects but we are not looking for and don't expect rich short term rewards. What I would point out is that, with a market value at our year-end of circa £100 million, representing 41% of our net asset value, the size of the holding confers quite a large single investment risk (which includes that of Brazil itself and of a major long-term decline in the price of oil). However, with the underlying net asset value of Ocean Wilsons being £14.85 per share at our year-end and its share price being £11.75, there was a discount to the underlying value of 21%, providing some offset to the risks involved.

DIVIDEND

14.0p per share (2011: 3.5p)

The  Board  of  Directors  is  recommending  to  shareholders the payment of a final dividend of 10.5p per ordinary and  "A"  ordinary  share.  If approved at the Annual General Meeting, it will be paid to shareholders of record 22 June 2012 on 10 August 2012.  An interim dividend was paid to shareholders on 2 December 2011 so that the total in respect of the year will amount to 14.0p per share, which compares with that of 3.5p per share paid last year.

The payment of our dividends in respect of the last three years has been affected by the timings of the dividends received from our portfolio holdings with the result that two years ago (2010) we paid dividends totalling 25p per share, last year (2011) we paid one dividend of 3.5p per share and in respect of this year - assuming shareholders approve a final dividend of 10.5p per share - we will have paid two dividends totalling 14p per share.

We have made the point in the past that we pay out what we earn but that the income that we earn is dependent on what is in the portfolio during the course of the year. Some years we will earn more, other years less.  However, over the long term we would expect the level of dividends to grow as the underlying profits of our portfolio companies grow. Using the same five year time span as we do to look at our long‑term capital growth, the payments over five year periods have grown to demonstrate how our dividends tend to grow over the long‑term.  Although the last three years have been affected by the incidence of payments referred to above, dividend payments have grown in a satisfactory way over the years.

SHARE PRICE PERFORMANCE

Ordinary shares:           -3.3% to 920p per share;         Discount to NAV: 17.7%

"A" Ordinary shares:     -6.1% to 873p per "A" share;  Discount to NAV: 21.9%

After last year's excellent returns, the fall in our two share prices was disappointing, particularly as the net asset value registered a small gain. However the increase in the discount at which our shares sell to the underlying net asset value more than offset both the increase in the net asset value and the payment of the 3.5p dividend.

Attribution of Shareholder Returns                                                  Ordinary Shares           'A' Ordinary

Shares

Share price change due to change in NAV                                  +14.8p             +1.6% +14.5p +1.6%

Share price change due to change in discount                               -45.8p             -4.8% -70.5p   -7.7%

Dividends paid during the year                                                     +14.0p +1.5%   +14.0p          +1.5%

Shareholders' Total Return                                                           -17.0p  -1.8%    -43.0p           -4.6%

There  was  a  very  short  term  aberration  in  the  difference between the two share prices, which normally trade much more closely than the 5% differential over the year end.  The difference narrowed shortly after the year end and is a more normal 2% as I write. It did of course affect the numbers in the table above.  As I have mentioned in the past, we do not seek to manage the discount, believing that it is the gain in the net asset value and the payment of dividends that will drive long‑term returns.  The better they are the more likely our shares are likely to be in demand and the discount is to be at a low level.  All the buybacks in the world are unlikely to protect shareholders from a large discount if our performance were to be poor.

LONG TERM NAV RETURNS

5 Years NAV: +7.5% Benchmark: +29.4%

Ordinary share price: +17.7%   FTSE A-s Index: -8.5%'A' Ordinary share price: -14.6%

We continue to stress that Hansa Trust and its portfolio are run on a long‑term basis and that we regard five years as a reasonable accounting period for the "long‑term".  However, in the table below we set out the record over three, five and ten years - in part because different shareholders will have different views about the duration of "long‑term".

NAV Returns over:       NAV                Benchmark                   FTSE All‑Share Index

Over 3 Years               +76.0%            +15.9%                                                +51.3%

Over 5 Years               +7.5%              +29.4%                                               -8.5%

Over 10 Years             +200.8%          +63.4%                                                +17.4%

In examining the attribution of our five year performance we look at what different sectors and what different holdings have contributed to the performance.  Shareholders will not be surprised to learn that the biggest contributor to our five year performance has been the holding in Ocean Wilsons, having added most of the return that we have achieved over what has proven to be a difficult period - starting as it did on 1 April 2007, shortly before the financial crisis erupted.  However, other holdings have made good contributions including those in NCC Group, Hargreaves Services and Andor Technology. Inevitably - it is the very nature of portfolio management - there were losses, the most severe being Leadcom Integrated Solutions, Ark Therapeutics and Lloyds Banking Group.  We do monitor the performance of the portfolio (ex the holding in Ocean Wilsons) and the table below shows how that has done.

NAV (ex OW holding) over:     NAV    Benchmark       FTSE All‑Share Index

Over 3 Years                           +52.6%                        +15.9%                       +51.3%

Over 5 Years                           -9.4%                         +29.4%                         -8.5%

Over 10 Years                         +91.6%                        +63.4%                        +17.4%

And finally, given the five year time scale, we look at the  record  of  Hansa  Trust  over  the  past  to  see  how  we  have  done  over  successive  five  year  periods  and  to  see  if  we  are fulfilling our primary goal - that of making money for  shareholders  over  the  long‑term.  By and large we have been successful at that.  

ANNUAL GENERAL MEETING

31 July 2012 at 11.30am at the Washington Hotel, Curzon Street.

The Annual General Meeting ("AGM") will be held at the Washington Hotel, Curzon Street London  at 11.30 a.m. on Tuesday 31 July 2012. We have always had a good turnout of Shareholders, which is important to your Directors, giving us the chance to hear your views and to answer any questions that you may have.  John Alexander will give his presentation on the past year and on the prospects for the present one (and beyond). Please come and join us for the occasion. Each and every year each Director submits himself for re-election at the AGM. We are in the process of appointing a new director to the Board but we will not have made the appointment by the time of the meeting. In anticipation of the appointment of the new director, Jamie Borwick, who has served as a director for 28 years, will not offer himself for re-election at the meeting. He has been an excellent director over these many years and his tenure as both Chairman and as a Director is ample evidence that time served can enhance independent performance. On behalf of all of us Shareholders. I would like to thank him for his considerable contribution to the Company.

CORPORATE GOVERNANCE, 20 YEARS ON:

Ever since 1992, when Sir Adrian Cadbury's report set out some guidelines on how boards should govern companies, corporate governance regulation has grown like weeds. During the last twenty years the Stock Exchange and latterly the Financial Reporting Council, which is charged with the laying down the rules and regulations of corporate governance, has undertaken numerous reviews using different nomenclature (including Cadbury, Greenbury, Turnbull, Hampel, Higgs, Smith, Myners and Walker). Each report has introduced yet more governance regulation, bureaucratising business leadership along the way and yet in recent times and under this regulated regime we have experienced the most damaging corporate governance failures arguably ever - perpetrated by our major banks. It's time to ask the question: why has such catastrophic failure occurred given all the governance regulations that now exist?

There are two parts to the practise of corporate governance: stewardship and development. The former involves looking after the business and includes ensuring compliance with rules and regulations and the latter with developing the business on a long-term basis for the benefit of those involved (the stakeholders) on behalf of the owners and for their own ultimate benefit. The UK Corporate Governance Code ("the Code") focuses its attention on the former, promoting a bureaucratic culture of box ticking at the expense of the latter; it needs to focus on both.

There is clearly a lot that is good and sensible about our modern governance regime but the fact cannot be ducked that massive failure has occurred within it. So I will set out some of the flaws that we, your directors, think have contributed to the failure and will continue to do so in the future:

• The separation of corporate governance responsibilities within many large institutional investors between the corporate governance department (which understands the rules) and the fund manager (who understands the business) leads to mixed messages and bad stewardship.

• Very sensibly the Code operates on a "comply-or-explain" basis, laying down principles to be followed. In practice "comply-or-explain" is not working because institutional investors, trade bodies and consultants set out their own "must-be-obeyed" rules - having neither the time nor the inclination to consider any explanations to the contrary.  That too leads to bad stewardship. 

• The so-called "9 year rule" on the tenure of independence is nonsensical and dangerous. It is based on the incorrect premise that a person of sound, independent character and behaviour will automatically "go native" and become dependent on the word of management after 8 years and 365 days.  In fact time served gaining experience of the business strengthens the confidence and resolve of an independent minded director, making him/her more independent.  The so called rule leads to good and experienced directors being arbitrarily forced to leave boards and to higher than desirable turnover of non-executives, leading in turn to a less experienced cadre of non-executive directors and greater control of boardroom affairs by management, quite the opposite effect to that which the "rule" intended.

• Ideally the Chairman should have had coalface experience of the business of his/her company.  If not, he/she should be appointed from the ranks of the longer serving non-executive directors.  Without this experience, it is rather more difficult for a board to monitor and to challenge management generally and the chief executive specifically.  Successful chief executives tend to be strong-minded, forceful and persuasive so that a chairman requires experience of the business to fulfil his/her role effectively.

• It is, however, imperative that there is coalface experience amongst the cadre of independent directors.  It is worth noting that, as at 31 December 2007 (the year following which the banking crisis erupted) and as best I can tell, neither the chairman nor any of the independent directors of the Royal Bank of Scotland had ever made a bank loan in his or her life nor invested in a financial derivative, making it well nigh impossible to stand up to a personality as strong as that of Fred Goodwin. No wonder the Bank got into such trouble.

• The role of an independent director should encompass spending as much time outside the board room as within it, getting to know the company and remaining on top of what's going on without depending on management's word for it. If some of the independent directors of our banks had visited their operating offices and branches on a frequent basis (which I can only assume they didn't), they might have seen what was coming down the road.  Independence confers the obligation to find out for oneself.

• The boards of large companies are far too large, contributing to group think (stifling proper discussion) and to a box ticking culture, creating an obstacle to non-executive directors performing their roles in an independent manner.

• And finally the social engineering of boards is profoundly dangerous. While women may be frustrated by the number of men on boards, the fact is that business experience (the most important requirement of any director) is, for historical reasons, dominated by men. That will change as more and more women gain the necessary business experience. Forcing inexperienced persons onto boards for political purpose results in lesser corporate governance experience and lesser competence.  However, that is not the whole issue: it also sets a dangerous precedent.  If women can be mandated onto boards for political reasons, then so can other persons with other political causes so that the integrity of corporate governance becomes politicised and corrupted.

Addressing some of these issues would be easy, others wouldn't. But, if the purpose of proper and effective corporate governance is to maintain effective companies that serve society, then these issues need to be addressed.  At the heart of good governance lies trust - trust that those in charge will fulfil their duties competently and selflessly.  No system of rules can mandate that; and unfortunately, with or without rules, there will always be corporate misadventure.  In fact I do believe that the vast majority of the UK's non-executive directors pass the trustworthy test.  The problems lie with our culture of distrust; by and large boards are not trusted by the authorities and by large institutional investors, trade bodies and consultants to perform their duties without prescribed rules and regulations telling them how to do so. That distrust is a great weakness.

And finally, as a footnote, there is the criticism that, driven by the selfish pursuit of short-term shareholder value, boards have lost control of moral values generally and management remuneration specifically. While this is certainly true, I do not think that the modern regime of corporate governance can be held responsible for that. Rather it has been brought about by a general culture of greed and selfishness that pervades most walks of society.

PROSPECTS: THE CASE FOR EQUITIES

So much is written about our economic and financial prospects that it is hardly worth adding my two pence to the mountain of comment that emerges daily from the media and from the City. Some of it is wise, a lot of it is self-justification but the truth is that never in recent times - certainly not in my forty plus years in the City - has the outlook been more uncertain, have the tea leaves been more difficult to read. But the truth is that none of us know what is in store for us; the current set of economic and financial policies are a huge gamble - or to be rather more polite about it a huge experiment. History does not suggest that printing money on a very large scale in order to avoid economic pain, to buy time and to promote growth is likely to succeed. It is a political policy of expediency with highly questionable ethics.

So how do we as investors, as savers, protect our wealth, our savings in these desperately uncertain times? Do we keep our monies locked up in a tin? Do we convert it all into gold coins to try to protect it from the ravages of monetary debasement? Do we, if we can, convert it into tangible assets such as property or even jewellery or art? Or should we seek the safety of our government's bonds in the belief that it will honour its obligations? In truth it is possible to make a case for any of these investment havens depending on the view we take of the future. But do any of the many asset classes available to us provide some sort of safe haven in most, if not all, of the economic and financial circumstances that may evolve out of the mess that our country is in? Arguably there is one; it is not a certain, yet alone a guaranteed safe haven but it does cover a lot of eventualities. Investment in equities as an asset class does provide the investor with a chance of protecting his/her savings and wealth, of providing a reasonable income while doing so and finally of growing in real terms thereby enhancing those savings, that wealth.

The many different prospects for our economic future would appear to fit into one of two categories - that of deflation as price levels weaken, even decline, as in turn the government and consumers seek to pay down debt and cut their own expenditures in doing so; in stark contrast there is the possibility that we experience a surge in price levels as governments print money to pay their bills. In the former circumstances and as a generalisation, companies have the ability and indeed the flexibility to manage their affairs to protect balance sheets, their profits and dividends much as many have done so in the last four or so years of financial crisis: balance sheets have strengthened, profits and dividends have grown. If however inflation were to erupt - and it can do so quite suddenly - then companies have the ability and flexibility to increase prices to protect those profits and dividends. Not all companies will enjoy either or both of these attributes but many will. Choosing the right companies for investment will be the secret for success; it is the stock in trade of the fund manager.

Perhaps the main attraction of equities as an investment for people's savings in this day and age of ludicrously low interest rates, is that companies pay dividends that can grow. It means that the growing demand for income resulting from the financial needs of an ageing population, will create growing demand for those equities with reasonable yields with, in turn, dividend growth prospects. The deflationary scenario means that interest rates will remain low, making equities with growing dividends particularly attractive. However the inflationary scenario, in which profits can grow in line with or better than inflation rates, allows equities to protect their real values. It may sound complacent to say so but it can be a win-win situation. Given that the country's demographics will drive the demand for dividends, we may well return to the days when dividend yields were the valuation parameters of share prices.

It would be wrong to be complacent about the attraction of equities as, I am afraid, many people in the City are. It is not a given that they will do well. First of all share prices will continue to be very volatile as investors' moods swing from bullish to bearish and back again. Secondly business generally and the City specifically has a fat cat reputation for greed and for thriving at the expense of the public generally; that makes the corporate world vulnerable to political backlash. And finally, with governments so strapped for cash, the corporate world with its strong, cash rich balance sheets is an obvious taxation target for finance ministers.

Not all equities will prove to be the safe haven that I have suggested they can be. But many will.  Indeed successful investment has always been about backing sound, honest and capable people.  It is our job to find those well managed (management is more important than ever) companies with good business franchises capable of generating the profits, cash flow and dividends that will attract investors to their shareholder lists. William, John and their colleagues have done so in the past and I have every confidence that on a long-term basis they will continue to do so.

Group Income Statement - (Unaudited)

for the year ended 31 March 2012

	Revenue		Capital		Total		Revenue		Capital		Total
	2012		2012		2012		2011		2011		2011
	£000		£000		£000		£000		£000		£000
Gains on investments	-		1,404		1,404		-		49,127		49,127
Loss on derivatives	-		-		-		-		(16)		(16)
Exchange losses on currency	-		(3)		(3)		-		(4)		(4)
balances
Investment income	6,049		-		6,049		3,009		-		3,009
	6,049		1,401		7,450		3,009		49,107		52,116
Investment Management fee	(1,565)		-		(1,565)		(1,386)		-		(1,386)
Write back of prior years' VAT	-		-		-		51		-		51
Other expenses	(801)		-		(801)		(724)		-		(724)
	(2,366)		-		(2,366)		(2,059)		-		(2,059)
Profit before finance costs
and taxation	3,683		1,401		5,084		950		49,107		50,057
Finance costs	(154)		-		(154)		(114)		-		(114)
Profit before taxation	3,529		1,401		4,930		836		49,107		49,943
Taxation	(4)		-		(4)		(4)		-		(4)
Profit for the year	3,525		1,401		4,926		832		49,107		49,939
Return per Ordinary and 'A'
non-voting Ordinary share	14.7p		5.8p		20.5p		3.5p		204.6p		208.1p

The Company does not have any income or expense that is not included in the profit for the year. Accordingly the "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.

The total column of this statement represents the Group's Income Statement, prepared in accordance with IFRS. The supplementary revenue 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.

Statement of Changes in Equity - Group - (Unaudited)

for the year ended 31 March 2012

				Capital								Capital
		Share		redemption		Retained				Share		redemption		Retained
		capital		reserve		earnings		Total		capital		reserve		earnings		Total
		201	2	2012		2012		2012		2011		2011		2011		2011
		£000		£000		£000		£000		£000		£000		£000		£000
Net assets at 1 April		1,200		300		262,613		264,113		1,200		300		213,514		215,014
Profit for the year		-		-		4,926		4,926		-		-		49,939		49,939
Dividends		-		-		(832)		(832)		-		-		(840)		(840)
Net assets at 31 March		1,200		300		266,707		268,207		1,200		300		262,613		264,113

Statement of Changes in Equity - Company - (Unaudited)

for the year ended 31 March 2012

			Capital								Capital
	Share		redemption		Retained				Share		redemption		Retained
	capital		reserve		earnings		Total		capital		reserve		earnings		Total
	2012		2012		2012		2012		2011		2011		2011		2011
	£000		£000		£000		£000		£000		£000		£000		£000
Net assets at 1 April	1,200		300		262,613		264,113		1,200		300		213,514		215,014
Profit for the year	-		-		4,926		4,926		-		-		49,939		49,939
Dividends	-		-		(832)		(832)		-		-		(840)		(840)
Net assets at 31 March	1,200		300		266,707		268,207		1,200		300		262,613		264,113

Balance Sheet of the Group and Company - (Unaudited)

as at 31 March 2012

	Group		Group		Company		Company
	2012		2011		2012		2011
	£000		£000		£000		£000
Non-current investments
Investment in subsidiary at fair value though profit and loss	-		-		632		633
Investments at fair value through
profit or loss	270,944		266,435		270,944		266,435
	270,944		266,435		271,576		267,068
Current assets
Trade and other receivables	294		281		294		281
Cash and cash equivalents	137		8,295		137		8,295
	431		8,576		431		8,576
Current liabilities
Trade and other payables	(3,168)		(10,898)		(3,800)		(11,531)
Net current liabilities	(2,737)		(2,322)		(3,369)		(2,955)
Net assets	268,207		264,113		268,207		264,113
Capital and reserves
Called up share capital	1,200		1,200		1,200		1,200
Capital redemption reserve	300		300		300		300
Retained earnings	266,707		262,613		266,707		262,613
Total equity shareholders' funds	268,207		264,113		268,207		264,113
Net asset value per Ordinary and 'A' non-voting Ordinary share	1,117.5p		1,100.5p		1,117.5p		1,100.5p

Cash Flow Statement - (Unaudited)

for the year ended 31 March 2012

	Group 2012		Group 2011		Company 2012		Company 2011
	£000		£000		£000		£000
Cash flows from operating activities
Gain before finance costs and taxation	5,084		50,057		5,084		50,057
Adjustments for:
Realised (gains)/losses on investments	4,388		(3,689)		4,388		(3,689)
Unrealised gains on investments	(5,792)		(45,438)		(5,792)		(45,437)
Effect of foreign exchange rate changes	3		(4)		3		(4)
(Increase)/decrease in trade and other receivables	(13)		350		(13)		350
(Decrease)/increase in trade and other payables	(195)		182		(195)		181
Taxes paid	(4)		(4)		(4)		(4)
Purchase of non-current investments	(11,582)		(24,688)		(11,582)		(24,688)
Sale of non-current investments	8,412		23,755		8,412		23,755
Net cash inflow/(outflow) from operating activities	301		521		301		521
Cash flows from financing activities
Interest paid on bank loans	(154)		(114)		(154)		(114)
Dividends paid	(832)		(840)		(832)		(840)
(Repayment)/drawdown of loans	(7,470)		6,900		(7,470)		6,900
Net cash (Outflow)/outflow from financing activities	(8,456)		5,946		(8,456)		5,946
(Decrease)/increase/ in cash and cash equivalents	(8,155)		6,467		(8,155)		6,467
Cash and cash equivalents at 1 April	8,295		1,824		8,295		1,824
Effect of foreign exchange rate changes	(3)		4		(3)		4
Cash and cash equivalents at 31 March	137		8,295		137		8,295

Notes

INCOME

	Revenue		Revenue
	2012		2011
	£000		£000
Income from quoted investments
Dividends	2,892		2,353
Overseas dividends	3,156		649
	6,048		3,002
Other operating income
Interest receivable on AAA rated money market funds	1		2
Other interest receivable	-		5
	1		7
Total income	6,049		3,009

DIVIDENDS PROPOSED AND PAID

The Board are proposing a final dividend of 10.5p per share

	Revenue		Revenue
	2012		2011
	£000		£000
Amounts recognised as distributions to equity holders in the year:
Interim dividends paid for 2012: 3.5p (2011: 3.5p)	840		840
Proposed final dividend for 2012: 10.5p  (2011: nil)	2,525		-
	3,365		840

Set out above are the total dividends paid and proposed in respect of the financial year, which is the basis on which the requirements of s1158 CTA 2010 are considered. The Company's revenue available for distribution by way of dividend for the year is £3,525,000 (2011: £832,000).

Notes:

1.     This Preliminary Announcement is not the Group's statutory accounts. It is an abridged version of the Group's full draft accounts for the year ended 31 March 2012, which have not yet been approved, audited or filed with the Registrar of Companies.

2.     The full draft accounts for the year ended 31 March 2012 have been prepared in accordance with International Financial Reporting Standards ("IFRS") and using the same accounting policies as those in the last published annual accounts, being those to 31 March 2011.

3.     Statutory accounts for the 12 months ended 31 March 2011 have been delivered to the Registrar of Companies and received an audit report which was unqualified, did not include a reference to any matter to which the auditors drew attention without qualifying the report, and did not contain statements under Section 498 of the Companies Act 2006.

Hansa Capital Partners LLP - Company Secretary

14 June 2012

 

END

 

 

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