Final Results

Henderson High Income Trust PLC 06 March 2003 6 March 2003 HENDERSON HIGH INCOME TRUST plc Unaudited Preliminary Results for the year ended 31 December 2002 Highlights * Earnings per share increased by 3.9% to 9.95p * Total dividend for the year unchanged at 9.90p Extracts from the Chairman's Statement: Assets and Performance Stockmarkets have been particularly depressed since the half-year, as a number of factors have curbed investor sentiment towards equities. Against a backdrop of sluggish economic and corporate profits, deflation fears and ultimately the risk of war in Iraq, investment returns have been very poor. In the UK, we have seen additional pressure as life assurance companies have been forced to sell equities to correct solvency margins. Equities have fallen for the third year running, leaving valuations at historically low levels. Over the year the Company's ordinary shares registered a negative net asset value total return of 19.2%, a marginally better result than the 22.7% fall in the FTSE All-Share Index. The units produced a better outcome; the net asset value total return only fell 10.6%, assisted by the performance of the zero dividend preference shares. Our management fee arrangement with Henderson Global Investors was reviewed at the end of the year and we have negotiated changes to the arrangement. The new fee incorporates a lower basic management fee and a capped performance related fee. Dividends The Board has declared an unchanged fourth interim dividend of 2.475p per ordinary share, making a total of 9.90p for the year. There have been a number of companies that have cut dividends over the last year and the outlook for dividends remains mixed. The Board's ability to increase the Company's dividends will depend on an increase in income from our investments. The Board reviews the level of distributions and the income generated by the portfolio regularly and efforts are always made to minimise the amount of income absorbed by costs. The Board intends to continue the present level of distributions in the current year and has considerable revenue reserves to offset any shortfall during 2003. - MORE - - 2 - HENDERSON HIGH INCOME TRUST plc Unaudited Preliminary Results for the year ended 31 December 2002 Extracts from the Chairman's Statement (cont'd): The Board We are looking to expand the Board of your Company. It is our current intention to appoint at least one new director but we are mindful of the outcome of both the Higgs and the AITC reviews of investment trust directors. These reviews are very wide ranging and seek to maintain the independence of directors from the investment management company. Until the recommendations of these reviews are clear it may prove difficult to make an appointment but I look forward to keeping you up to date with progress later in the year. Prospects There are many uncertainties troubling investors, particularly the situation surrounding Iraq. A resolution should soon become apparent, allowing investors to concentrate on the economic prospects where I believe positive, albeit slow, progress is occurring. The lowest interest rates for 40 years, combined with depressed valuations, have already sparked a number of financial bids, including Safeway and Six Continents. Your Company holds both of these shares as investments; I expect more bids will follow if share prices do not recover in the short term. William Eason Chairman 5 March 2003 - MORE - - 3 - HENDERSON HIGH INCOME TRUST plc Unaudited Preliminary Results for the year ended 31 December 2002 Group Statement of Total Return (incorporating the revenue account) for the year ended 31 December 2002 Year ended 31 December 2002 Year ended 31 December 2001 Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000 Net capital losses from investments - (14,960) (14,960) - (1,314) (1,314) Income from fixed asset investments 6,461 - 6,461 6,147 - 6,147 Other interest receivable and similar income 79 - 79 97 - 97 ---------- ---------- ---------- ---------- ---------- ---------- Gross revenue and capital losses 6,540 (14,960) (8,420) 6,244 (1,314) 4,930 Management fee (330) (495) (825) (299) (448) (747) Other administrative expenses (222) - (222) (170) - (170) ---------- ---------- ---------- ---------- ---------- ---------- Net return/(loss) on ordinary activities 5,988 (15,455) (9,467) 5,775 (1,762) 4,013 before interest payable and taxation Interest payable (228) (684) (912) (338) (1,015) (1,353) Provision for redemption of the zero dividend - (2,403) (2,403) - (2,221) (2,221) preference shares in the subsidiary ---------- ---------- ---------- ---------- ---------- ---------- Net return/(loss) on ordinary activities 5,760 (18,542) (12,782) 5,437 (4,998) 439 before taxation Taxation on net return/(loss) on ordinary (352) 342 (10) (392) 393 1 activities ---------- ---------- ---------- ---------- ---------- ---------- Net return/(loss) on ordinary activities after 5,408 (18,200) (12,792) 5,045 (4,605) 440 taxation ---------- ---------- ---------- ---------- ---------- ---------- Dividends: ordinary shares 1st interim paid of 2.475p (2001: 2.475p) (1,341) - (1,341) (1,302) - (1,302) 2nd interim paid of 2.475p (2001: 2.475p) (1,372) - (1,372) (1,302) - (1,302) 3rd interim declared of 2.475p (2001: 2.475p) (1,372) - (1,372) (1,316) - (1,316) 4th interim proposed of 2.475p (2001: 2.475p) (1,372) - (1,372) (1,316) - (1,316) ---------- ---------- ---------- ---------- ---------- ---------- (5,457) - (5,457) (5,236) - (5,236) ---------- ---------- ---------- ---------- ---------- ---------- Transfer from reserves (49) (18,200) (18,249) (191) (4,605) (4,796) ========== ========== ========== ========== ========== ========== Return/(loss) per ordinary share 9.95p (33.49)p (23.54)p 9.58p (8.74)p 0.84p ========== ========== ========== ========== ========== ========== Return per zero dividend preference share in - 4.57p 4.57p - 4.22p 4.22p the subsidiary ========== ========== ========== ========== ========== ========== Return/(loss) per unit 9.95p (28.92)p (18.97)p 9.58p (4.52)p 5.06p ========== ========== ========== ========== ========== ========== The revenue columns of this statement represent the revenue accounts of the Group. -MORE- - 4- HENDERSON HIGH INCOME TRUST plc Unaudited Preliminary Results for the year ended 31 December 2002 Group and Company Balance Sheets at 31 December 2002 Group Company Group Company 2002 2002 2001 2001 £'000 £'000 £'000 £'000 Fixed asset investments Listed in the United Kingdom 104,902 104,902 119,123 119,123 ---------- ---------- ---------- ---------- 104,902 104,902 119,123 119,123 ---------- ---------- ---------- ---------- Current assets Debtors 1,247 1,247 2,019 2,019 Bank balances and short term deposits - - 1,000 1,000 ---------- ---------- ---------- ---------- 1,247 1,247 3,019 3,019 Creditors: amounts falling due within one year (21,959) (21,959) (24,986) (24,986) ---------- ---------- ---------- ---------- Net current liabilities (20,712) (20,712) (21,967) (21,967) ---------- ---------- ---------- ---------- 84,190 84,190 97,156 97,156 Total assets less current liabilities Creditors: amounts falling due after one year Amounts owed to group undertaking - (31,710) - (29,307) Zero dividend preference shares in the subsidiary (31,710) - (29,307) - Provisions for liabilities and charges - - - - ---------- ---------- ---------- ---------- Net assets 52,480 52,480 67,849 67,849 ========== ========== ========== ========== Capital and reserves Share capital 2,771 2,771 2,659 2,659 Capital redemption reserve 26,302 26,302 26,302 26,302 Other capital reserves Share premium 8,398 8,398 5,630 5,630 Realised reserve 18,556 18,556 20,192 20,192 Unrealised (depreciation)/appreciation (4,642) (4,642) 11,922 11,922 Revenue reserve 1,095 1,095 1,144 1,144 ---------- ---------- ---------- ---------- Equity shareholders' funds 52,480 52,480 67,849 67,849 ========== ========== ========== ========== Net asset value per ordinary share 94.68p 94.68p 127.59p 127.59p ========== ========== ========== ========== Funds attributable to: Ordinary shares 52,480 67,849 Zero dividend preference shares in the subsidiary 31,710 29,307 ---------- ---------- 84,190 97,156 ========== ========== Net asset value per: Ordinary share 94.68p 127.59p Zero dividend preference share in the subsidiary 60.28p 55.71p ---------- ---------- Unit 154.96p 183.30p ========== ========== - MORE - - 5 - HENDERSON HIGH INCOME TRUST plc Unaudited Preliminary Results for the year ended 31 December 2002 Group Cash Flow Statement for the year ended 31 December 2002 2002 2002 2001 2001 £'000 £'000 £'000 £'000 Net cash inflow from operating activities 5,370 5,394 Servicing of finance Bank overdraft and loan interest paid (924) (1,398) Taxation Taxation recovered 133 154 Financial investment Purchase of investments (35,307) (50,374) Sale of investments 35,494 47,867 ----------- ----------- Net cash inflow/(outflow) from financial investment 187 (2,507) Equity dividends paid (5,345) (5,208) ----------- ----------- Net cash outflow before financing (579) (3,565) Financing Issue of shares 2,881 724 Expenses of capital reorganisation - 16 (Decrease)/increase in debt (3,518) 3,807 ----------- ----------- Net cash (outflow)/inflow from financing (637) 4,547 ---------- --------- (Decrease)/increase in cash (1,216) 982 ========== ========= Reconciliation of net cash flow to movement in net debt (Decrease)/increase in cash as above (1,216) 982 Cash outflow/(inflow) from (decrease)/increase in debt 3,518 (3,807) Exchange movements (36) (2) ---------- ---------- Movement in net debt 2,266 (2,827) Net debt at 1 January (21,207) (18,380) ---------- ---------- Net debt at 31 December (18,941) (21,207) ========== ========= -MORE- - 6 - HENDERSON HIGH INCOME TRUST plc Unaudited Preliminary Results for the year ended 31 December 2002 Notes : 1. Share Capital At 31 December 2002 there were in issue 55,428,865 (2001: 53,178,865) ordinary shares of 5p each in the parent and 52,603,865 (2001: 52,603,865) zero dividend preference shares of 50p each in the subsidiary. During the year under review, 2,250,000 ordinary shares of 5p each were allotted and issued for cash consideration as follows: Date Allottee No. of Shares Price per share 15 May Apollo Nominees Limited 1,000,000 147.0p 4 July Apollo Nominees Limited 400,000 127.0p 25 July CLS Nominees Limited 550,000 105.0p 26 July CLS Nominees Limited 200,000 105.5p 10 September CLS Nominees Limited 100,000 114.0p Therefore, as at 31 December 2002, there were 55,428,865 ordinary shares of 5p each in issue (2001: 53,178,865). 2. Return per share a) Returns per ordinary share Revenue return per ordinary share is based on the earnings attributable to the ordinary shares of £5,408,000 (2001: £5,045,000) and on the 54,346,536 weighted average number of ordinary shares in issue during the year (2001: 52,677,016). Capital loss per ordinary share is based on the net capital loss for the year of £18,200,000 (2001: capital loss of £4,605,000) and on the 54,346,536 weighted average number of ordinary shares in issue during the year (2001: 52,677,016). b) Returns per zero dividend preference share Capital return per zero dividend preference share reflects the predetermined growth in capital entitlement for the year of £2,403,000 (2001: £2,221,000) based on the 52,603,865 (2001: 52,603,865) zero dividend preference shares in issue. c) Returns per unit Revenue return per unit, each unit consisting of one ordinary share of 5p each in the Company and one zero dividend preference share of 50p each in the subsidiary, amounts to 9.95p per unit. Capital loss per unit, each unit consisting of one ordinary share of 5p each in the Company and one zero dividend preference share of 50p each in the subsidiary, amounts to (28.92)p per unit. 3. Group accounts The Group accounts consolidate the accounts of the Company and its wholly owned subsidiary, Henderson High Income Trust Securities plc. -MORE- - 7 - HENDERSON HIGH INCOME TRUST plc Unaudited Preliminary Results for the year ended 31 December 2002 4. Expenses All expenses are accounted for on an accruals basis. The Board's expectation is that over the long term three quarters of the Group's investment returns will be in the form of capital gains. On this basis, the Group charges to capital 75% of its finance costs and management fees (to the extent that the management fees relate to the maintenance or enhancement of the valuation of investments). 5. Dividend A fourth interim dividend of 2.475p per ordinary share of 5p each (2001: 2.475p per ordinary share of 5p each) will be paid on 30 April 2003 to shareholders on the register on 21 March 2003. 6. 2002 accounts The preliminary figures for the year ended 31 December 2002 are an extract from the latest accounts of the Group. These accounts have not yet been delivered to the Registrar of Companies, nor have the auditors yet reported on them. 7. 2001 accounts The figures and financial information for the year ended 31 December 2001 are extracted from the latest published accounts of the Group and do not constitute the statutory accounts for that year. Those accounts have been delivered to the Registrar of Companies and included the report of the auditors which was unqualified and did not contain statements under either section 237(2) or section 237(3) of the Companies Act 1985. 8. Annual Report and Annual General Meeting The full annual report and accounts will be posted to shareholders in March and copies will be available from the Secretary at the Company's Registered Office, 4 Broadgate, London EC2M 2DA. The Annual General Meeting will be held on Wednesday 30 April 2003. - ENDS - For further information please contact : Alex Crooke Fund Manager Henderson High Income Trust plc Telephone: 020 7818 4447 Stephen Westwood Head of Investment Trusts Henderson Global Investors Telephone: 020 7818 5517 Stephen Phillips Investor Relations Manager Henderson Global Investors Telephone: 020 7818 6417 Vicki Staveacre Henderson Press Office Telephone: 020 7818 4222 This information is provided by RNS The company news service from the London Stock Exchange WISDSEED

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