Final Results

RNS Number : 5828B

Henderson Eurotrust PLC

07 October 2015

 



HENDERSON EUROTRUST PLC

Annual Report for the year ended 31 July 2015

Investment objective

The objective of Henderson EuroTrust plc ("the Company") is to invest predominantly in large and medium-sized companies which are perceived to be undervalued in view of their growth prospects or on account of a significant change in management or structure. The Company aims to achieve a superior total return from a portfolio of high quality European investments.

Performance highlights

•           The net asset value ("NAV") per share total return (including dividends reinvested and excluding transaction costs) was 13.9% compared to a total return from the benchmark index, the FTSE World Europe (ex UK) Index of 9.6%.

•           Increased proposed annual dividend: final dividend 13.0p, (2014: 12.50p) producing a total dividend for the year of 18.50p (2014: 17.50p), an increase of 5.7% on the previous year.

•           As at 31 July 2015 the Company's shares were trading at a small premium to NAV of 0.7%, in comparison to trading at a small discount of 0.9% at the prior year end.

Total return performance (including dividends reinvested and excluding transaction costs)
	1 year %	3 years %	5 years %	10 years %
Net asset value per ordinary share1	13.9	65.2	82.8	170.0
Share price2	15.8	91.2	108.0	204.4
AIC Europe Sector (Peer Group) Average - net asset value3	15.5	62.3	79.3	135.5
FTSE World Europe (ex UK) Index	9.6	55.3	52.5	100.6



1 Source: Morningstar for the AIC using cum income fair value NAV for one, three and five years and capital NAV plus income reinvested for 10 years

2 Based on the mid-market share price

3 Size weighted average (shareholders' funds)

Financial Highlights
	31 July 2015 pence per share	31 July 2014 pence per share
Net Asset Value	895.0	803.2
Revenue Return	18.3	17.6
Dividends	18.5	17.5

Chairman's Statement

Performance

I am very pleased to be able to report another year of positive returns to shareholders, and outperformance of the Company's benchmark by our Fund Manager. The Company's net asset value ("NAV") rose by 13.9% on a total return basis, compared to a rise in the benchmark index (the FTSE World Europe (ex UK) Index) of 9.6% over the year in sterling terms. This is the eighth consecutive year of outperformance against the benchmark, an extremely impressive track record, especially given that the NAV is calculated net of all fees.

Dividends

Your Board is cognisant of the importance of sustainable dividend growth in the current low yield environment and I am pleased to report increases in both the interim and final dividend for the year under review. At the half year the Board declared an interim dividend of 5.5p, up from 5.0p in the prior period, and is proposing a final dividend of 13.0p making total dividends for the year of 18.5p, a 5.7% increase year on year.

Charges and fees

As a consequence of the strong performance achieved by our Investment Manager, a performance fee of £878,000 for the financial year has been earned. Performance fees can only be earned if the net asset value total return over the year exceeds the benchmark by more than the hurdle of 1%. Your Board continues to believe that the performance fee arrangement is in the best interests of shareholders.

The Ongoing Charge for the year under review, being the management fee and other non-interest expenses as a percentage of shareholders' funds, was 0.84% (2014: 0.82%) excluding the performance fee, and 1.35% (2014: 0.87%) including the performance fee.

Share Capital

I am delighted to report that, for the first time in many years, your Company issued 365,000 ordinary shares to take advantage of demand in the market. The new shares were issued at a sufficient premium to the income inclusive NAV to ensure that the issues were NAV enhancing for existing shareholders. Subsequent to the year end, the Company has been granted a blocklisting which will reduce the cost associated with issuing further new shares thereby making it easier to meet natural demand as it occurs. The Company's share price has traded close to NAV for most of the year under review, either at a modest discount or small premium; at the year end, the shares were trading at a very small premium to NAV of 0.7%.

The opportunity to issue shares is, I believe, an important step for the Company. Investment companies have many advantages over open-ended funds, most notably a greater ability to implement a long term investment strategy, and the ability to add value through gearing. However, some investors are deterred by a lack of liquidity in investment trust shares and issuing shares will improve liquidity.

Furthermore, issuing new shares means the fixed costs of running your Company will be spread over a wider shareholder base which over time will aid performance.

Gearing

Day to day decisions on the level of gearing are taken by Tim Stevenson, the Company's Fund Manager, within the boundaries agreed by the Board. He has maintained a modest level of gearing during most of the year under review; the average gearing during the year being 3.9% and 3.5% at the end of the year. This has had a positive impact on returns. During the year, having considered alternative providers, we renewed the Company's £15 million multi-currency loan facility with the existing lender on improved terms.

Shareholders will be aware that some investment companies have chosen to take advantage of terms for long term fixed rate debt at all-time low levels, on the basis that, in the long run, equities will surely earn a return above the cost of borrowing. Set against such arguments are, however, the fact that shorter term borrowing has a materially lower current cost and we may yet be able to benefit from exceptionally attractive short term rates for some time to come.

Furthermore, our current arrangements have the benefit of almost complete flexibility, an important factor given the length and extent of the bull market since the 2008 Financial Crisis. We keep an open mind on the structure of the Company's debt, but for the time being remain unconvinced that fixed long term borrowings are in the interests of shareholders.

Investment approach and outlook

With the marked slowdown in China in the summer of 2015, it now looks as though short interest rates will remain lower for longer in the major economies. This is particularly the case in Europe where, earlier in the year, the European Central Bank made a commitment to buy government bonds (known as "Quantitative Easing") in an attempt to boost the rate of inflation towards a 2% level. In this uncertain environment equities, including European equities, have been weak in recent months. Yet European valuations are still reasonable in a historical context; and, boosted to some extent by the weaker currency, earnings growth remains strong. This is particularly true for your portfolio, which has a bias towards companies growing faster than the market average. Although an investment in equities is by its nature volatile, in an environment where returns on cash may well remain negligible, we continue to believe in the attractions of investing in a portfolio of high-quality investments capable of producing both capital growth and rising income over the longer term.

Nicola Ralston

Chairman

7 October 2015

Principal risks and uncertainties

The Board has drawn up a matrix of risks facing the Company and has put in place a schedule of investment limits and restrictions, appropriate to the Company's investment objective and policy, in order to mitigate these risks as far as practicable. The principal risks which have been identified and the steps taken by the Board to mitigate these are as follows:

• Investment activity and performance

An inappropriate investment strategy (for example, in terms of asset allocation or the level of gearing) may result in underperformance against the Company's benchmark index and the companies in its peer group. The Board monitors investment performance at each Board meeting and regularly reviews the extent of its borrowings.

• Portfolio and market

Although the Company invests almost entirely in securities that are quoted on recognised markets, share prices may move rapidly. The companies in which investments are made may operate unsuccessfully, or fail entirely. A fall in the market value of the Company's portfolio would have an adverse effect on shareholders' funds. The Board reviews the portfolio at each meeting and mitigates risk through diversification of investments in the portfolio.

• Regulatory

A breach of Section 1158 could lead to a loss of investment trust status, resulting in capital gains realised within the portfolio being subject to corporation tax. A breach of the UKLA Listing Rules could result in suspension of the Company's shares, while a breach of the Companies Act 2006 could lead to criminal proceedings, or financial or reputational damage. Henderson is contracted to provide investment, company secretarial, administration and accounting services through qualified professionals. The Board receives internal controls reports produced by Henderson on a quarterly basis, which confirm regulatory compliance.

• Operational

Disruption to, or failure of, the Manager's accounting, dealing or payment systems or the custodian's records could prevent the accurate reporting and monitoring of the Company's financial position. The Company is also exposed to the operational risk that one or more of its service providers may not provide the required level of service.

Details of how the Board monitors the services provided by Henderson and its other suppliers, and the key elements designed to provide effective internal control, are explained further in the internal controls section of the Corporate Governance Statement in the Annual Report. Further details of the Company's exposure to market risk (including market price risk, currency risk and interest rate risk), liquidity risk and credit and counterparty risk and how they are managed are contained in Notes to the Annual Report.

Related Party Transactions

The Company's current related parties are its Directors, and Henderson. There have been no material transactions between the Company and its Directors during the year and the only amounts paid to them were in respect of expenses and remuneration for which there were no outstanding amounts payable at the year end.

In relation to the provision of services by Henderson, other than fees payable by the Company in the ordinary course of business and the provision of sales and marketing services there have been no material transactions with Henderson affecting the financial position of the Company during the year under review. More details on transactions with Henderson, including amounts outstanding at the year end, are given in the Notes to the Annual Report.

Statement of Directors' Responsibilities

In accordance with Disclosure and Transparency Rule 4.1.12, each of the Directors confirms that, to the best of his or her knowledge:

(a) the Company's financial statements, which have been prepared in accordance with UK Accounting Standards on a going concern basis, give a true and fair view of the assets, liabilities, financial position and profit of the Company; and

(b) the Strategic Report and financial statements include a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that it faces.

Nicola Ralston

Chairman

Fund Manager's Report

Overview and performance

The last twelve months to 31 July 2015 have seen European equity markets perform well in local currency terms. For the Sterling or Dollar investor returns have been lower but still positive, due to the fact that Sterling has appreciated by 13.9% against the Euro. I am pleased to say that the Company has once again outperformed the FTSE World Europe (ex UK) Index by a good margin. For the year to 31 July 2015 the Net Asset Value ("NAV") total return was13.9%, and the share price total return was 15.8%. The FTSE World Europe (ex UK) Index returned 9.6% on a total return basis over the year. Furthermore, we have increased the dividend by 5.7%, implying a dividend yield at the year end share price of 2.05%. There have been the usual episodes of headwinds - in particular the situation in Greece. For many years the Company has had no involvement in this market, so the impact has been indirect in that some believe Greece could provide a foretaste of other Euro members' experiences. While I share many of the concerns about the Euro, I do not subscribe to the view that it will collapse, in spite of the obvious stresses. It is a sad fact that most of the UK press concentrates its effort on all the negative aspects and omits to report on where progress is being made. The last twelve months has seen the start of an economic recovery across most of Europe, and undoubtedly part of that can be attributed to the reforms which have been (painfully) implemented. It is furthermore encouraging that earnings have also started to recover for many European companies, assisted no doubt by the weaker Euro and unprecedented monetary stimulus from the ECB. This recovery in profits has not been in every sector. The weaker oil price has obviously weighed on that part of the market, and we have continued with only a very selective exposure here. The same is true in raw materials and even in some of the industrial conglomerates, many of which have continued to struggle to compete against intense overseas competition. Part of the outperformance this year (as in every year) is no doubt due to the avoidance of some of these areas.

The main contributors and detractors to performance during the year are set out in the Annual Report. Fresenius and Fresenius Medical Care both made good contributions, as did Partners Group (which incidentally featured in fund performance detractors last year, once again demonstrating the need for patience). The largest negatives were Statoil and OW Bunker.

On the latter, OW Bunker was the first bankruptcy of a holding in the Company's 23 year history. OW Bunker collapsed after a fraud in its Singapore subsidiary. The cost to the Company was about 1.2% of NAV on the day the stock's value was written down to zero on the announcement, but this impact was mitigated by the diverse nature of our holdings and the appreciation of many of those on the same day.

While I think it is unlikely that we will recoup any of our investment, we (together with other institutional shareholders) are pursuing the matter through the proper channels in Denmark where the company had only recently listed. I apologise to shareholders for this loss, but I am afraid it was a fraud and we have more than recouped the loss by success elsewhere.

During the year demand for European shares has risen from investors worldwide and as a result we have been trading at close to NAV or at a small premium for much of the year. We have taken advantage of this ongoing demand to issue shares in the Company at a premium to NAV, which has the benefit of increasing the Company's size and thereby spreading costs over a larger base.

Portfolio changes and approach

There have been three key assumptions which form the background for the approach during the year: caution on anything that has little pricing power (cyclical companies, oil services), confidence that economic recovery will help earnings recover in much of the banking sector, and a continued belief that in a low growth world companies with a reliable growth profile will be favoured. Our caution on oil stocks has led to the sale of ENI in Italy and a reduction in our positions in Statoil and Maersk (which has oil as well as shipping in its portfolio). We have added a small position in Lundin Petroleum which has part ownership of a number of fields which will start significant production from next year. We have also sold out of our holding in Adecco, St Gobain and ABB, with the latter a good example, in our view, of a well-managed company struggling to compete against lower cost producers in Asia.

A total of 15 positions have been sold, and 16 added, with the number of holdings at year end at 52. New holdings include Italian car component company Brembo and Italian motorway utility Atlantia which is benefiting from greater traffic on the motorways as the Italian economy recovers as well as having a holding in the main Rome airport. Other new positions include Swatch and luxury company Hermès. All these names have, in our view, a consistent and reliable track record and prospects.

The level of turnover, as measured by the lower of purchases or sales as a percentage of the average assets was 47.3% compared with 57.5% the previous year. This continues a trend of lower turnover, although it must be borne in mind that the volatility in markets caused by huge inflows into European equities and the uncertainties caused by Greece, China, Ukraine, the Middle East and the expectation for higher interest rates at some stage relatively soon in the USA, all mean that we may have to adapt our positioning from time to time.

Outlook

The menu of "worries" mentioned in last year's Annual Report included Ukraine, the Middle East, and the prospect of tighter monetary policy in the USA and the UK. A year on, and the list is the same, and now Greece can be added, and also the uncertainty that may be caused by a sharper slowdown in the Chinese Economy. In addition there is a further pressure on the "Emerging Markets" which are struggling due to the strength in the US Dollar. There is a slight fear in the back of my mind that European markets are trading at high levels just at a time when perhaps we are close to being at the point where it is "as good as it gets". If there has been an element of "faute de mieux" behind the flows to European markets, then the flows which have avoided bonds might just swing back to ten year bonds when yields rise back towards a level of say 2.5% to 3% as inflation returns to a level of closer to 2% as expected by the ECB.

It could herald a more difficult twelve months ahead. In spite of that word of caution, the facts are clear that European economies are recovering, which is a result of the huge stimulus from the ECB's Quantitative Easing (QE) programme. This may have started later than some had wanted, but the fact that it was launched at a time when some were arguing that recovery had already started might mean that Europe is experiencing QE on steroids. Lower raw material prices - especially oil - has meant that the significant decline in the Euro has not translated into inflationary pressures, but that a weaker Euro has boosted the translation impact of overseas sales and profits. With these earnings coming through, companies are continuing the trend of paying a greater proportion of earnings to shareholders and I am confident that we will see increasing dividends for our holdings again this year. There will almost certainly be stress within the Euro area again, but at last, after many years of hesitancy, global investors are beginning to understand that there are some outstanding companies listed on the European markets.

Tim Stevenson

Fund Manager

7 October 2015

Twenty Largest Holdings as at 31 July

	Company	Country	Sector	2015 Valuation £'000	Percentage of Portfolio 2015
1	Fresenius	Germany	Health Care	7,874	4.09
2	Deutsche Post	Germany	Air Freight & Logistics	7,384	3.84
3	Novartis	Switzerland	Pharmaceuticals and  Biotechnology	7,122	3.70
4	Groupe Eurotunnel	France	Industrial Transportation	6,717	3.49
5	Sodexo	France	Catering Services	6,591	3.43
6	Credit Agricole	France	Banks	6,419	3.34
7	Intesa Sanpaolo	Italy	Banks	6,222	3.24
8	Fresenius Medical Care	Germany	Health Care	6,065	3.15
9	ING	Netherlands	Banks	5,245	2.73
10	Essilor	France	Health Care	4,857	2.53
Top Ten Investments				64,496	33.54

The Top Ten Investments total £64,496,000 representing 33.54% by value (2014: 31.9%) of the total value of investments.

	Company	Country	Sector	2015 Valuation £'000	Percentage of Portfolio 2015
11	AXA	France	Insurance	4,738	2.47
12	Deutsche Telekom	Germany	Telecommunications	4,717	2.45
13	Nestlé	Switzerland	Food Producers	4,607	2.40
14	Atlantia	Italy	Industrial Transportation	4,563	2.37
15	BIC	France	Commercial Supplies	4,449	2.31
16	Partners Group	Switzerland	Financial Services	4,261	2.22
17	Amadeus	Spain	Support Services	4,010	2.09
18	Svenska Cellulosa	Sweden	Personal Goods	3,962	2.06
19	Roche	Switzerland	Pharmaceuticals and  Biotechnology	3,776	1.96
20	Nordea Bank	Sweden	Banks	3,771	1.96
Top Twenty  Investments				107,350	55.83

The Top Twenty investments total £107,350,000 representing 55.83 % by value (2014: 52.2%) of the total investments.

Sector exposure at 31 July

As a percentage of the investment portfolio excluding cash

	31 July 2015	31 July 2014
Oil & Gas	2.6	5.5
Basic Materials	3.7	1.9
Industrials	18.8	25.1
Consumer Goods	19.6	19.3
Health Care	16.5	15.1
Consumer Services	9.0	7.6
Financials	23.1	16.8
Technology	1.3	5.8
Telecommunications	5.4	1.9
Utilities	0.0	1.0

Geographic exposure at 31 July

As a percentage of the investment portfolio excluding cash

	31 July 2015	31 July 2014
Austria	0.0	1.6
Denmark	2.5	7.3
France	29.9	21.7
Germany	23.8	28.2
Ireland	1.5	0.0
Italy	7.1	3.0
Netherlands	4.0	4.4
Norway	1.3	2.8
Spain	5.6	3.6
Sweden	7.3	5.4
Switzerland	17.0	22.0

Market capitalisation of the portfolio at 31 July

Market cap	% of portfolio at 31 July 2015	% Benchmark weight                         at 31 July 2015
>£20bn	50.05	60.50
£10bn - £20bn	22.07	17.73
£5bn - £10bn	19.04	12.90
£1bn - £5bn	8.84	8.66
<£1bn	0.00	0.21

Audited Income Statement

for the year ended 31 July

	Year ended 31 July 2015			Year ended 31 July 2014
	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 (note 2)	-	20,419	20,419	-	6,017	6,017
Investment income (note 3)	4,842	-	4,842	4,628	-	4,628
Other income	-	-	-	2	-	2
	---------	----------	---------	---------	----------	---------
Gross revenue and capital gains	4,842	20,419	25,261	4,630	6,017	10,647
Management and performance fees	(226)	(1,784)	(2,010)	(219)	(955)	(1,174)
Other administrative expenses	(362)	-	(362)	(344)	-	(344)
	---------	----------	---------	---------	----------	---------
Net return on ordinary activities before finance charges and taxation	4,254	18,635	22,889	4,067	5,062	9,129
Finance charges	(11)	(45)	(56)	(12)	(51)	(63)
	---------	----------	---------	---------	----------	---------
Net return on ordinary activities before taxation	4,243	18,590	22,833	4,055	5,011	9,066
Taxation on net return on ordinary activities	(489)	-	(489)	(473)	-	(473)
	---------	----------	---------	---------	----------	---------
Net return on ordinary activities after taxation	3,754	18,590	22,344	3,582	5,011	8,593
	=====	=====	=====	=====	=====	=====
Return per ordinary share- basic and diluted (note 4)	18.3p	90.7p	109.0p	17.6p	24.5p	42.1p
	=====	=====	=====	=====	=====	=====

The total column of this statement represents the Profit and Loss Account of the Company.

All revenue and capital items in the above statement derive from continuing operations. 

The revenue return and capital return columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies. 

The Company had no recognised gains or losses other than those disclosed in the Income Statement.

Audited Reconciliation of Movements in Shareholders' Funds

for the year ended 31 July 

Year ended 31 July 2015	Called up share capital £'000	Share premium account £'000	Capital redemption reserve £'000	Capital reserves £'000	Revenue reserve £'000	Shareholders' funds total £'000
At 1 August 2014	1,020	33,814	263	123,864	4,810	163,771
Net return on ordinary activities   after taxation	-	-	-	18,590	3,754	22,344
Ordinary shares issued	18	3,335	-	-	-	3,353
Issue cost	-	(35)	-	-	-	(35)
Final dividend paid in respect of   the year ended 31 July 2014   (paid 21 November 2014)	-	-	-	-	(2,549)	(2,549)
Interim dividend paid in respect of   the year ended 31 July 2015   (paid 24 April 2015)	-	-	-	-	(1,129)	(1,129)
	----------	-----------	----------	-----------	----------	------------
At 31 July 2015	1,038	37,114	263	142,454	4,886	185,755
	======	======	======	=======	======	=======
Year ended 31 July 2014	Called up share capital £'000	Share premium account £'000	Capital redemption reserve £'000	Capital reserves £'000	Revenue reserve £'000	Shareholders' funds total £'000
At 1 August 2013	1,020	33,814	263	118,853	4,695	158,645
Net return on ordinary activities   after taxation	-	-	-	5,011	3,582	8,593
Final dividend paid in respect of   the year ended 31 July 2013   (paid 20 November 2013)	-	-	-	-	(2,447)	(2,447)
Interim dividend paid in respect of   the year ended 31 July 2014   (paid 25 April 2014)	-	-	-	-	(1,020)	(1,020)
	----------	-----------	----------	-----------	----------	------------
At 31 July 2014	1,020	33,814	263	123,864	4,810	163,771
	======	======	======	=======	======	=======

Audited Balance Sheet

At 31 July

	2015 £'000	2014 £'000
Fixed asset investments held at fair value through   profit or loss
Listed at market value  -  overseas	192,294	165,206
	----------	----------
Current assets
Debtors	465	776
Cash at bank and in hand	2,561	1,513
	---------	---------
	3,026	2,289
Creditors: amounts falling due within one year	(9,565)	(3,724)
	---------	---------
Net current liabilities	(6,539)	(1,435)
	---------	---------
Net assets	185,755	163,771
	======	======
Capital and reserves
Called up share capital (note 7)	1,038	1,020
Share premium account	37,114	33,814
Capital redemption reserve	263	263
Capital reserves	142,454	123,864
Revenue reserve	4,886	4,810
	-----------	-----------
Total shareholders' funds	185,755	163,771
	======	======
Net asset value per ordinary share   (basic and diluted) (note 6)	895.0p	803.2p
	======	======

Audited Cash Flow Statement

for the year ended 31 July

	2015		2014
	£'000	£'000	£'000	£'000
Net cash inflow from operating activities		2,280		2,407
Servicing of finance
Interest paid	(58)		(64)
	--------		--------
Net cash outflow from servicing of finance		(58)		(64)
Taxation
Overseas tax recovered	437		4
	--------		--------
Net tax recovered		437		4
Financial investment
Purchases of investments	(89,385)		(96,856)
Sales of investments	82,364		100,842
	----------		----------
Net cash  (outflow)/ inflow from financial investment		(7,021)		3,986
Equity dividends paid		(3,678)		(3,467)
		---------		---------
Net cash (outflow)/ inflow before financing		(8,040)		2,866
Financing
Ordinary shares issued	3,318		-
Drawdown /(repayment) of loans	5,690		(4,729)
	--------		--------
Net cash inflow/(outflow) from financing		9,008		(4,729)
		--------		--------
Increase/(decrease) in cash		968		(1,863)
		=====		=====
Reconciliation of net cash flow to movement in net debt		2015 £'000		2014 £'000
Increase/(decrease) in cash as above		968		(1,863)
Exchange movements		692		425
Net cash flow from (increase)/ decrease in loans		(5,690)		4,729
		---------		---------
Change in net debt resulting from cash flows		(4,030)		3,291
Net debt at 1 August		(1,418)		(4,709)
		---------		---------
Net debt at 31 July		(5,448)		(1,418)
		======		======
Represented by:
Cash and cash equivalents		2,561		1,513
Bank loans		(8,009)		(2,931)
		---------		---------
		(5,448)		(1,418)
		======		======

Notes:

1.	Accounting policies
	Basis of accounting
	The financial statements have been prepared on a going concern basis and under the historical cost basis of accounting, modified to include the revaluation of investments at fair value through profit or loss. The financial statements have been prepared in accordance with applicable accounting standards in the United Kingdom and with those parts of the Companies Act 2006 applicable to companies reporting under the standards and with the Statement of Recommended Practice ('SORP') for investment trusts issued by the Association of Investment Companies ('the AIC') in January 2009. The Company's accounting policies are consistent with the prior year.
2.	Gains on investments held at fair value through profit or loss
			2015 £'000	2014 £'000
	Gains on the sale of investments based on historical cost		6,114	15,900
	Less: revaluation gains recognised in previous years		(6,244)	(13,704)
			----------	----------
	(Losses)/gains on investments sold in the year based on carrying value at the previous balance sheet date		(130)	2,196
	Revaluation of investments held at 31 July		19,857	3,434
	Exchange gains		692	387
			----------	----------
			20,419	6,017
			======	======
3.	Investment income		2015 £'000	2014 £'000
	Overseas dividend income		4,842	4,628
			=====	=====
4.	Return per ordinary share basic and diluted
	The total return per ordinary share is based on the net return attributable to the ordinary shares of £22,344,000 (2014: £8,593,000) and on 20,501,199 ordinary shares (2014: 20,390,541) being the weighted average number of shares in issue during the year.
	The total return can be further analysed as follows:
		2015 £'000		2014 £'000
	Revenue return	3,754		3,582
	Capital return	18,590		5,011
		----------		----------
	Total return	22,344		8,593
		======		======
	Weighted average number of ordinary shares	20,501,199		20,390,541
	Revenue return per ordinary share	18.3p		17.6p
	Capital return per ordinary share	90.7p		24.5p
		----------		----------
	Total return per ordinary share	109.0p		42.1p
		======		======

5.	Dividends on ordinary shares
						2015 £'000
	Revenue available for distribution by way of dividend for the year					3,754
	Interim dividend of 5.5p paid 24 April 2015					(1,129)
	Proposed final dividend for the year ended 31 July 2015 of 13.0p (based on 21,155,541 ordinary shares in issue at 7 October 2015)					(2,750)
						-----------
	Undistributed revenue for section 1158 purposes*					(125)
						======
	*Undistributed revenue comprises 0.0% of the total income of £4,842,000. The proposed final dividend of 13.0p per share for the year ended 31 July 2015 is subject to approval by shareholders at the Annual General Meeting and has not been included as a liability in these financial statements. The proposed final dividend of 13.0p per ordinary share will be paid on 23 November 2015 to shareholders on the register of members at the close of business on 16 October 2015. The shares will be quoted ex-dividend on 15 October 2015.
6.	Net asset value per ordinary share
	The net asset value per ordinary share of 895.0p (2014: 803.2p) is based on the net assets attributable to ordinary shares of £185,755,000 (2014: £163,771,000) and on 20,755,541 (2014: 20,390,541) ordinary shares in issue at the year end.  There were no shares held in Treasury at the year end (2014: nil).
7.	Called up share capital
			Number of shares entitled to dividend	Total number of shares	Nominal value of shares £'000
	Ordinary shares of 5p each - authorised			75,000,000	3,750
				========	=====
	Balance at the start and end of the year ended 31 July 2014		20,390,541	20,390,541	1,020
	New shares issued in the year		365,000	365,000	18
			---------------	---------------	----------
	At 31 July 2015		20,755,541	20,755,541	1,038
			========	========	=====
	During the year no ordinary shares were repurchased (2014: none). Since 31 July 2015, a further 400,000 shares have been issued.
8.	Going Concern Statement
	The Directors believe that it is appropriate to continue to adopt the going concern basis in preparing the financial statements as the assets of the Company consist mainly of securities which are readily realisable and, accordingly, the Company has adequate financial resources to continue in operational existence for the foreseeable future. In reviewing the position as at the date of this report, the Board has considered the "Going Concern and Liquidity Risk: Guidance for Directors of UK Companies 2009", published by the Financial Reporting Council in October 2009.

9.	2015 Financial information
	The figures and financial information for the year ended 31 July 2015 are extracted from the Company's annual financial statements for that period and do not constitute statutory financial statements for that period. The Company's annual financial statements for the year ended 31 July 2015 have been audited but have not yet been delivered to the Registrar of Companies. The Independent Auditors' Report on the 2015 financial statements was unqualified, did not include a reference to any matter to which the Auditors drew attention without qualifying the report, and did not contain any statements under sections 498(2) and 498(3) of the Companies Act 2006.
10.	2014 Financial information
	The figures and financial information for the year ended 31 July 2014 are compiled from an extract of the published financial statements of the Company and do not constitute statutory financial statements for that year. The Company's annual financial statements have been delivered to the Registrar of Companies and included the Independent Auditors' Report which was unqualified and did not contain a statement under either section 498(2) and 498(3) of the Companies Act 2006.
11.	Annual Report and Annual General Meeting
	The Annual Report for the year ended 31 July 2015 will be posted to shareholders in October 2015 and copies will be available on the Company's website (www.hendersoneurotrust.com) or in hard copy format from the Company's Registered Office, 201 Bishopsgate, London EC2M 3AE. The Annual General Meeting will be held at the registered office on Wednesday 18 November 2015 at 2.30 pm. The Notice of the Annual General Meeting will be posted to shareholders with the Annual Report.

For further information please contact:

Tim Stevenson Fund Manager, Henderson EuroTrust plc Telephone: [phone]	James de Sausmarez Head of Investment Trusts, Henderson Global Investors Telephone: [phone]
Sarah Gibbons-Cook Investor Relations and PR Manager, Henderson Global Investors Telephone: [phone]

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) is incorporated into, or forms part of, this announcement.

 

END

 

 

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