Final Results

RNS Number : 5269A

JP Morgan Mid Cap Invest Trust PLC

09 October 2009

 



LONDON STOCK EXCHANGE ANNOUNCEMENT

JPMORGAN MID CAP INVESTMENT TRUST PLC

FINAL RESULTS FOR THE YEAR ENDED 30TH JUNE 2009

AND PROPOSED NEW ARTICLES OF ASSOCIATION 

The Directors of JPMorgan Mid Cap Investment Trust plc announce the Company's results for the year ended 30th June 2009. The following comprises extracts from the Company's Annual Financial Report for the year ended 30th June 2009. The full Annual Report and Accounts, including the Notice of the Annual General Meeting will be available to be viewed on or downloaded from the Company's website at www.jpmmidcap.co.uk shortly.

Chairman's Statement

Investment Performance

It was one of the most challenging years for investors, certainly in living memory. A year now has elapsed since the implosion of Lehman Brothers which led to a major collapse in world stockmarkets and banking failures. Without prompt and forceful action by central banks and policy makers last October, panic would likely have continued to intensify, more major financial firms would have failed and the entire global financial system would have been at risk. Unprecedented monetary easing and fiscal expansion did not prevent a dramatic economic downturn, but they succeeded in stabilising the financial system, have stimulated a strong recovery in stockmarkets and more recently economic recovery, including in the UK. 

For the Company, net assets per share (NAV) for the year to 30th June 2009 fell from 576.1p to 364.6p. Any fall in absolute return is disappointing, but what was particularly frustrating for the Board and for shareholders was that the fall in the NAV was significantly larger than the fall in the FTSE 250 index (excluding investment trusts) which is the key benchmark for measurement of the Company's performance. 

A review of the Company's performance is given in the Investment Managers' Report below. You will see there that the main factor leading to the underperformance was misjudgements in stock selection. We reviewed in detail with the Manager, JPMorgan Asset Management (UK) Limited ('JPMAM'), their investment approach and the reasons for the underperformance and, as a consequence, changes were made in the management team in May 2009 and explained below.

Investment Manager

The objective we set the Manager remains the same: to achieve capital growth through investing in medium-sized UK companies. The main measurement of the Manager's performance continues to be the FTSE 250 index (excluding investment trusts). The current dividend policy, to increase dividends annually at least in line with inflation, as long as normal market conditions prevail, remains unaltered. 

In May 2009, at the instigation of the Board, JPMAM changed the investment management arrangements for the Company when William Meadon and Jane Lennard took over responsibility from Jeremy Wells and Chris Llewellyn. William, who is Head of UK Specialist Equities at JPMAM, now oversees the Company's strategy and gearing, whilst Jane, who is a specialist manager of mid cap companies, is responsible for day-to-day stock selection.

The Board has been concerned about the under-performance of the portfolio in recent times and is pleased with the new team that has been appointed. In the past, stock selection was based primarily on JPMorgan's proprietary model which built a "barbell" portfolio of both value and growth stocks typically with a lower valuation than the benchmark, but with higher expected earnings growth. Although this barbell investment process produced good results for the FTSE 100, it was less successful for Mid Cap companies. The new team will still employ the model to identify cheap, fast-growing stocks, but will use it more as a screening mechanism and will then adopt a more proactive stock picking approach, with investment judgment placing even greater emphasis on fundamental analysis and company meetings. Having examined this approach in some detail, the Board is confident that the new team, employing a refined investment process, should be capable of delivering the returns that shareholders are entitled to expect. Their restructuring of the portfolio, which involved substantial changes, has now been largely completed. 

JPMAM is a leading Manager in the investment trust sector and we believe that JPMAM, with their professionalism and commitment, should remain as the Company's Investment Manager and that their ongoing appointment is in the best interests of shareholders. The Board thoroughly and regularly reviews the appointment of the Manager and the investment strategy and process.

Revenue and Dividends

Net revenue for the year was £4,758,000 (2008: £4,785,000) and earnings per share, calculated on the average weekly number of shares in issue, were 18.74p (2008: 17.64p). This year's revenue included a significant non-recurring contribution of £1,233,000 in the first half from the VAT recovery, as referred to in the Half Year Report. At the half year stage, the Company paid a maintained dividend of 5.5p per share and, in addition, a special dividend of 4.9p per share representing the amount of the VAT recovery and the associated interest which was taken to income. 

It is our intention to pay an increased final dividend of 11.5p per share (2008: 11.0p) making a total, excluding the special dividend which was of a one-off nature, of 17.0p (2008: 16.5p) which represents a 3.0% rise in the total dividend. The payment of the final dividend involves a transfer from revenue reserve of £785,000 and following its payment the revenue reserve will amount to £4,971,000, which is in excess of one year's total dividend. The dividend is payable on 19th November 2009 to shareholders on the register at the close of business on 23rd October 2009.

At this stage, it is very difficult to forecast the dividend income we expect to receive in the current financial year as the outlook for corporate profits remains uncertain; on current estimates dividend income for this financial year will be lower than that recorded in the year under review. However, the Board recognises the importance of income to shareholders and, if considered appropriate, we may draw on the strong revenue reserve to which we have regularly added.

Gearing

Although gearing has had an adverse impact on performance in the year under review, the Board believes in the benefits of gearing over the long term. The Company has an £8 million loan facility with the ING Bank and a £9.5 million debenture, redeemable at par in 2016 or at the option of the Company after 1st December 2011, which give the Managers the ability to gear tactically. The Board of Directors sets the overall gearing strategy and guidelines and reviews these at each meeting; gearing changes between meetings may be undertaken after consultation with the Board. At the year end gearing was 106.8% and at the time of writing the Company remains modestly geared.

Discount Management

It is the present intention of the Board to continue its policy of buying back shares, whether for cancellation or into Treasury, to assist in the maintenance of a stable discount and enhance the net asset value per share. This policy will be reviewed regularly in the light of market conditions. During the year under review, the Company repurchased into Treasury 607,500 shares, representing 2.3% of the issued share capital at the start of the year. This process added 0.1% to NAV return over the course of the year. 

Whilst the Company has not repurchased any shares for cancellation over the course of the year, the Directors continue to believe that this mechanism is of benefit to shareholders and therefore propose and recommend that powers to repurchase up to 14.99% of the Company's shares for cancellation be renewed for a further period. 

At recent Annual General Meetings, shareholders have approved the use of Treasury shares to improve further the liquidity of the Company's shares. The ability to buy shares into Treasury and then reissue them at a narrower discount to net asset value gives your Board a further tool to manage any imbalance between supply and demand. In seeking the renewal of shareholder approval for the reissue of shares from Treasury at a discount, the Board will maintain its strict limit to the dilution associated with any reissue to a maximum of 0.5% of net asset value in any one year. The Board recommends that shareholders renew the Company's authority to reissue shares from Treasury at a discount. 

Board of Directors

Your Board has put procedures in place to ensure that the Company complies fully with the Combined Code and the AIC Code on Corporate Governance. 

In accordance with the Company's Articles of Association, the Director retiring by rotation and seeking re-election at this year's Annual General Meeting is Andrew Barker. John Emly also retires on grounds of tenure (having served as a Director for thirteen years) and seeks re-election. The Nomination and Remuneration Committee has met to consider the attributes and contributions of the individuals concerned and, following this review, has no hesitation in recommending their re-election at the forthcoming Annual General Meeting. 

Annual General Meeting 

This year's Annual General Meeting will be held on 18th November 2009 at 12.00 noon at The Salters' Hall, 4 Fore Street, London EC2Y 5DE. 

Prospects

Here in the UK, economic recovery is fragile, but there are encouraging signs. While many questions remain about the sustainability of the recovery, it would be a major disappointment if the UK economy does not start to grow by the end of 2009. However, as long as policy remains supportive, the positive factors should outweigh the negatives. We believe a low growth, low interest rate environment can still be good for most assets. This includes equities and companies that can demonstrate above average growth.

Mid cap companies are proving adept at cutting costs out of their businesses. There is also a substantial amount of cash, earning very little on deposit, waiting to be re-deployed into the stockmarket. Although it must be remembered that the mid cap sector of the stockmarket has already risen by more than 50% from its low in March, we believe valuations are not unreasonable based on current forecasts.

Andrew Barker

Chairman    9th October 2009

  Investment Managers' Report

Performance and Market Background

Disappointingly, the Company's net asset value total return of -33.4% underperformed the Company's benchmark index, the FTSE 250 excluding investment trusts, which returned -14.9%. A narrowing of the discount from 15.2% to 11.6% resulted in a total return to shareholders of -29.7%.

The modestly geared position that the Company operated throughout the year proved to be a headwind in the falling markets that we suffered for much of the year. This detracted 2.8% from performance. The largest element of underperformance came from poor stock selection. This negatively impacted performance by 16.0%.

Over the year, the worst detractors from performance were Intermediate Capital Group, Randgold Resources and GKN. Intermediate Capital provides finance to companies for buyouts and expansions. Its share price fell dramatically as the market became concerned about default rates on the loans and consequently the value of its loan book. Randgold Resources, the African gold miner, performed well over the year under review as gold confirmed its safe haven status in times of economic uncertainty. This hurt relative performance as the Company did not hold the stock. GKN halved in price over the year under review as its end markets (automotive and aerospace) suffered the full force of the recession.

The stocks in the portfolio which were the largest contributors to performance over the year were Amlin, Halfords and Debenhams. Amlin, the Lloyds insurer, performed well with market participants pricing in the possibility of insurance premiums rising and profitability improving as capital was withdrawn from the insurance market as a whole. An overweight position in Halfords also contributed positively as the range of goods sold such as bicycles and car maintenance products proved to be relatively resilient to the consumer downturn. Another retailer, Debenhams, added to performance as sales beat market expectations and the market became more comfortable with the company's high level of debt.

This outcome was against a backdrop of continuing market weakness. The FTSE mid 250 index reached a low of 5,490 in November, having begun the Company's year at 9,145. It then rallied early in the calendar year, but took a further lurch down in the spring as the wider UK market hit its low in March 2009 (the FTSE 100 hit its low on 3rd March). The first half of the Company's financial year saw Lehman Brothers Holdings Inc, the US investment bank, file for bankruptcy. This failure led to a global freezing of credit markets and highlighted the interdependence of financial institutions around the world. Other banks were deemed too big to fail and Governments around the world stepped in to prevent a collapse of the international banking system. 

The evaporation of confidence and limited availability of credit prompted companies and investors to focus on balance sheets. The market became very nervous of highly geared companies and, at the company level, finance directors looked to realise cash by reducing stock levels. This draw down of inventories coupled with reduced consumer confidence led to a dramatic drop in demand throughout the economy.

The Bank of England responded by cutting interest rates to an unprecedented 0.5% in March 2009 and introduced a policy of 'quantitative easing'. The Government also introduced fiscal measures, such as the temporary reduction in VAT, in the hope that this would encourage consumer spending and stimulate the economy.

During the final three months of the financial year the catastrophic failure of the banking system that some had feared, began to look less likely. Companies from many different sectors saw demand stabilising as the savage de-stocking of inventories that had occurred after Lehman Brothers collapsed came to an end. Aggressive cost cutting has enabled many companies to report first half earnings that were better than expected. This has helped share prices to build on earlier gains and has maintained the positive momentum of the market.

Recent Activity

Since the change of the management team on the 27th May 2009 there has been a major restructuring of the portfolio. During this process £40 million worth of stock has been bought and sold. The weighting in cyclical stocks has been increased. Many of these stocks had fallen more than the market and as economic prospects improve these stocks should perform well as a recovery in profits is priced in by the market. The largest buys have been Misys, (an IT software provider specialising in healthcare and banking markets), Drax (owner of a coal-fired electricity generating plant), Kesa (the owner of Comet in the UK), and Venture Production (a North Sea gas producer that has recently received a takeover bid from Centrica). The largest sells from the portfolio were Aggreko (a power generator & temperature control rental company), Tullett Prebon (a global inter-dealer broker), Wolseley (building and plumbing distributors) and Ashtead (UK and US plant hire).

As new managers, we are looking for attractively priced companies that have built market leading positions within their industries, have strong management teams, and an appropriate capital structure. The managers base their investment decisions on fundamental research and hold meetings with more than 250 companies each year. Portfolio construction is a very important part of the investment process and we aim to balance the portfolio with both growth stocks that offer genuine growth at an attractive price, and lowly valued, out of fashion companies that are likely to be re-rated as the market begins to appreciate future prospects.

The mid cap index is dynamic in that it offers both value opportunities as unloved stocks drop out of the FTSE 100 and exciting growth opportunities as successful companies are promoted to the FTSE 250 from the small cap index.

Outlook

The FTSE 250 index has now risen 50% from its March nadir. Government intervention has averted a global collapse of the banking system, but this has come at a cost. Public sector spending in the developed world, and especially in the UK, will be constrained for some time as the budget deficits incurred by supporting banks and industry are unwound.

Unemployment will continue to hinder economic growth in the UK. Companies were quick to respond to this recession by cutting jobs at the beginning of the downturn, which has in turn led to an increase in unemployment. The employment market is likely to deteriorate further as UK companies continue to rationalise their costs by shedding jobs and as public sector spending comes under pressure.

The high levels of debt that had sustained above average growth prior to the crisis are being withdrawn both from households and companies. This degearing process started in 2007 and is still not complete. It will be a long process.

Recent data suggests that the global economy is stabilising and that some areas are witnessing growth. With interest rates at historic lows, the economy is likely to be very sensitive to any upward move in interest rates. Markets will be monitoring monetary policy from Central Banks very carefully as tightening monetary policy too quickly may induce the deep recession they were trying to avoid, but the threat of inflation will mean that they will be wary of keeping interest rates too low for too long. Although the lows of the market have now almost certainly been seen, the uncertain outlook is likely to result in further volatility in share prices which should provide us with many attractive investment opportunities.

Jane Lennard

William Meadon

Investment Managers        9th October 2009

Adoption of new Articles of Association

The Company proposes to adopt new Articles of Association. These incorporate amendments to the current Articles of Association to reflect the changes in company law brought about by the 2006 Companies Act (the 'Act') which came into effect on 1st October 2009 and changes made to the 2006 Act in August 2009 to implement the EU Shareholder Rights Directive in the UK, as well as some minor technical or clarifying changes.

The principal changes in the new Articles of Association proposed to be adopted at the 2009 Annual General Meeting relate to shareholder meetings and resolutions, the Company's constitution and share capital.

In August 2009, changes were made to the provisions in the 2006 Act on company meetings by The Companies (Shareholders' Rights) Regulations 2009 ("Shareholders' Rights Regulations") to implement the EU Shareholder Rights Directive in the UK. The new articles incorporate amendments in relation to meetings to ensure consistency with the 2006 Act (as amended by the Shareholders' Rights Regulations). 

Under the 2006 Act all provisions of the Company's memorandum, but most significantly the objects clause, are deemed to form part of the Company's articles from 1st October 2009. It is possible for the objects clause to be removed or amended by amending the articles by special resolution. It is not necessary under the 2006 Act for a company to set out its objects. The 2006 Act provides that, unless the articles state otherwise, a company's objects will be unrestricted.

One of the other key provisions of the memorandum which is deemed to form part of the Company's articles from 1st October 2009 is the restriction created by the existing authorised share capital statement. The 2006 Act removes the requirement for a company to place limits on its authorised share capital.

By adopting the new Articles which do not contain the objects clause or the authorised share capital statement, the Company will remove these provisions, which would otherwise be deemed to form part of the Company's articles under section 28 of the 2006 Act, from its articles.

For a more detailed explanation of these and other amendments please refer to the Notice of Annual General Meeting and the Appendix in the Annual Report and Accounts. Copies of the new Articles of Association will be available for inspection at the offices of JPMAM, Finsbury Dials, 20 Finsbury Street, London EC2Y 9AQ from the date of this report up until the close of the Annual General Meeting.

Principal Risks

With the assistance of the Manager the Board has drawn up a risk matrix, which identifies the key risks to the Company.

These key risks fall broadly under the following categories:

• Investment and Strategy: An inappropriate investment strategy, for example asset allocation or the level of gearing, may lead to under-performance against the Company's benchmark index and peer companies, resulting in the Company's shares trading on a wider discount. The Board manages these risks by diversification of investments through its investment restrictions and guidelines which are monitored and reported on. JPMAM provides the Directors with timely and accurate management information, including performance data and attribution analyses, revenue estimates, liquidity reports and shareholder analyses. The Board monitors the implementation and results of the investment process with the Investment Managers, who attend all Board meetings, and review data which shows statistical measures of the Company's risk profile. The Investment Managers employ the Company's gearing tactically, within a strategic range set by the Board. The Board holds a separate meeting devoted to strategy each year.

• Market: Market risk arises from uncertainty about the future prices of the Company's investments. It represents the potential loss the Company might suffer through holding investments in the face of negative market movements. The Board considers asset allocation, stock selection and levels of gearing on a regular basis and has set investment restrictions and guidelines which are monitored and reported on by JPMAM. The Board monitors the implementation and results of the investment process with the Investment Managers.

• Accounting, Legal and Regulatory: In order to qualify as an investment trust, the Company must comply with Section 842 of the Income and Corporation Taxes Act 1988 ('Section 842'). Details of the Company's approval are given under "Business of the Company" above. Should the Company breach Section 842, it may lose investment trust status and as a consequence capital gains within the Company's portfolio would be subject to Capital Gains Tax. The Section 842 qualification criteria are continually monitored by JPMAM and the results reported to the Board each month. The Company must also comply with the provisions of the Companies Act 1985 and, as its shares are listed on the London Stock Exchange, the UKLA Listing Rules. A breach of the Companies Act could result in the Company and/or the Directors being fined or the subject of criminal proceedings. A breach of the UKLA Listing Rules may result in the Company's shares being suspended from listing which in turn would breach Section 842. The Board relies on the services of its Company Secretary, JPMAM, and its professional advisers to ensure compliance with the Companies Act 1985, the relevant amendments in the Companies Act 2006 and the UKLA Listing Rules.

• Corporate Governance and Shareholder Relations: Details of the Company's compliance with Corporate Governance best practice, including information on relations with shareholders, are set out in the Corporate Governance report.

• Operational: Disruption to, or failure of, JPMAM's accounting, dealing or payments systems or the custodian's records may prevent accurate reporting and monitoring of the Company's financial position. Details of how the Board monitors the services provided by JPMAM and its associates and the key elements designed to provide effective internal control are included within the Internal Control section of the Corporate Governance report.

• Financial: The financial risks faced by the Company include market price risk, interest rate risk, liquidity risk and credit risk.

Directors' Responsibilities

The Directors each confirm to the best of their knowledge that:

(a) the accounts, prepared in accordance with applicable accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company; and

(b) the Annual Report includes 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 face.

Andrew Barker

Chairman

9th October 2009

Please note that up to date information on the Company, including daily NAV and share prices, factsheets and portfolio information can be found at www.jpmmidcap.co.uk

For further information please contact:

Andrew Norman

For and on behalf of

JPMorgan Asset Management (UK) Limited, Secretary

020 7742 6000

  Income Statement

for the year ended 30th June 2009

		2009			2008
		Revenue	Capital	Total	Revenue	Capital	Total
		£'000	£'000	£'000	£'000	£'000	£'000
Losses on investments held at fair value through profit or loss		-	(52,973)	(52,973)	-	(61,675)	(61,675)
Income from investments		4,338	-	4,338	5,938	-	5,938
Other interest receivable and similar income		493	-	493	25	-	25
Gross return/(loss)		4,831	(52,973)	(48,142)	5,963	(61,675)	(55,712)
Management fee		(141)	(328)	(469)	(270)	(631)	(901)
VAT recoverable		766	819	1,585	-	-	-
Other administrative expenses		(339)	-	(339)	(306)	-	(306)
Net return/(loss) on ordinary activities before finance costs and taxation		5,117	(52,482)	(47,365)	5,387	(62,306)	(56,919)
Finance costs		(357)	(832)	(1,189)	(602)	(1,405)	(2,007)
Net return/(loss) on ordinary activities before taxation		4,760	(53,314)	(48,554)	4,785	(63,711)	(58,926)
Taxation		(2)	-	(2)	-	-	-
Net return/(loss) on ordinary activities after taxation		4,758	(53,314)	(48,556)	4,785	(63,711)	(58,926)
Return/(loss) per share (note 3)		18.74p	(209.97)p	(191.23)p	17.64p	(234.86)p	(217.22)p

All revenue and capital items in the above statement derive from continuing operations. No operations were acquired or discontinued in the year.

The 'Total' column of this statement is the profit and loss account of the Company and the 'Revenue' and 'Capital' columns represent supplementary information prepared under guidance issued by the Association of Investment Companies. The Total column represents all the information that is required to be disclosed in a Statement of Total Recognised Gains and Losses ('STRGL'). For this reason a STRGL has not been presented.

  Reconciliation of Movements in Shareholders' Funds

for the year ended 30th June 2009

	Called up	Capital
	share	redemption	Capital	Revenue
	capital	reserve	reserves	reserve	Total
	£'000	£'000	£'000	£'000	£'000
At 30th June 2007	7,308	2,692	215,810	7,841	233,651
Shares bought back and cancelled	(775)	775	(18,594)	-	(18,594)
Repurchase of shares into Treasury	-	-	(1,140)	-	(1,140)
Net (loss)/return on ordinary activities	-	-	(63,711)	4,785	(58,926)
Dividends appropriated in the year	-	-	-	(4,079)	(4,079)
At 30th June 2008	6,533	3,467	132,365	8,547	150,912
Repurchase of shares into Treasury	-	-	(2,793)	-	(2,793)
Net (loss)/return on ordinary activities	-	-	(53,314)	4,758	(48,556)
Dividends appropriated in the year	-	-	-	(5,423)	(5,423)
At 30th June 2009	6,533	3,467	76,258	7,882	94,140

  Balance Sheet

at 30th June 2009

		2009	2008
		£'000	£'000
Fixed assets
Equity investments held at fair value through profit or loss		100,519	161,155
Investment in liquidity fund held at fair value through profit or loss		4,500	700
Total investments		105,019	161,855
Current assets
Debtors		6,356	701
Cash and short term deposits		133	225
		6,489	926
Current liabilities
Creditors: amounts falling due within one year		(7,886)	(2,395)
Net current liabilities		(1,397)	(1,469)
Total assets less current liabilities		103,622	160,386
Creditors: amounts falling due after more than one year		(9,482)	(9,474)
Total net assets		94,140	150,912
Capital and reserves
Called up share capital		6,533	6,533
Capital redemption reserve		3,467	3,467
Capital reserves		76,258	132,365
Revenue reserve		7,882	8,547
Shareholders' funds		94,140	150,912
Net asset value per share (note 4)		371.9p	582.2p

  Cash Flow Statement

for the year ended 30th June 2009

		2009	2008
		£'000	£'000
Net cash inflow from operating activities		6,034	4,500
Returns on investments and servicing of finance
Interest paid		(1,188)	(2,030)
Net cash outflow from returns on investments and servicing of finance		(1,188)	(2,030)
Capital expenditure and financial investment
Purchases of investments		(99,846)	(198,285)
Sales of investments		106,023	240,526
Transaction costs		(782)	(1,566)
Other capital charges		(13)	(9)
Net cash inflow from capital expenditure and financial investment		5,382	40,666
Dividends paid		(5,423)	(4,079)
Net cash inflow before financing		4,805	39,057
Financing
Repurchase of ordinary shares		(2,897)	(20,324)
Repayment of short term loans		(2,000)	(18,800)
Net cash outflow from financing		(4,897)	(39,124)
Decrease in cash and cash equivalents		(92)	(67)

  Notes to the Accounts

for the year ended 30th June 2009

1.   Financial statements

The accounts are prepared in accordance with the Companies Act 2006, United Kingdom Generally Accepted Accounting Practice and with the Statement of Recommended Practice 'Financial Statements of Investment Trust Companies' issued by the AIC in January 2009.

All of the Company's operations are of a continuing nature.

The accounting policies applied in these accounts are consistent with those applied in the accounts for the year ended 30th June 2008. 

2.    Dividends

    Dividends paid and proposed

	2009	2008
	£'000	£'000
Unclaimed dividends refunded to the Company	-	(14)
2008 final dividend of 11.0p (2007: 9.5p)1	2,791	2,643
Interim dividend of 5.5p (2008: 5.5p)	1,392	1,450
Special dividend of 4.9p (2008: nil)	1,240	-
Total dividends paid in the year	5,423	4,079
2009 Final dividend proposed of 11.5p (2008: 11.0p)	2,911	2,851

    1The final dividend proposed in respect of the year ended 30th June 2008 amounted to £2,851,000 (2007: £2,777,000). However, the amount paid amounted to £2,791,000 (2007: £2,643,000) due to share repurchases after the balance sheet date but prior to the record date.

    The final dividend has been proposed in respect of the year ended 30th June 2009 and is subject to approval at the forthcoming Annual General Meeting. In accordance with the accounting policy of the Company, this dividend will be reflected in the accounts for the year ended 30th June 2010.

3.    Return/(loss) per share

    The revenue return per share is based on the earnings attributable to the ordinary shares of £4,758,000 (2008; £4,785,000) and on the weighted average number of shares in issue during the year of 25,391,440 (2008: 27,127,678).

    The capital loss per share is based on the capital loss attributable to the ordinary shares of £53,314,000 (2008: loss of £63,711,000) and on the weighted average number of shares in issue during the year of 25,391,440 (2008: 27,127,678).

    Total loss per share is based on the total loss attributable to the ordinary shares of £48,556,000 (2008: loss of £58,926,000) and on the weighted average number of shares in issue during the year of 25,391,440 (2008: 27,127,678).

4.    Net asset value per share

    Net asset value per share is based on total shareholders' funds attributable to ordinary shareholders of £94,140,000 (2008: £150,912,000) and on the 25,311,680 (2008: 25,919,180) shares in issue at the year end, excluding shares held in Treasury.

5. Status of preliminary announcement

The financial information set out in this preliminary announcement does not constitute the Company's statutory accounts for the years ended 30th June 2008 or 2009. The statutory accounts for the year ended 30th June 2008 and 2009 have been reported on by the Company's auditors. The auditors report for both years was unqualified and contained no statement under S498(2) or S498(3) of the Companies Act 2006. 

The statutory accounts for the year ended 30th June 2008 have been delivered to the Registrar of Companies and statutory accounts for the year ended 30th June 2009 will be delivered in due course.

JPMORGAN ASSET MANAGEMENT (UK) LIMITED

 

END

 

 

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