Final Results

RNS Number : 9289G

Personal Assets Trust PLC

02 June 2017

 

To:                   RNS

From:              Personal Assets Trust plc

Date:               2 June 2017

Results for the year ended 30 April 2017

The Directors of Personal Assets Trust ("PAT") are pleased to announce the Group's results for the year ended 30 April 2017.

The key points are as follows:

·      PAT is run expressly for private investors. Its investment policy is to protect and increase (in that order) the value of shareholders' funds per share over the long term.

·      Over the year to 30 April 2017 PAT's net asset value per share ("NAV") rose by 8.6%.  This compares to a rise of 15.8% in the FTSE All-Share Index.  PAT's share price rose by £32.90 during the year and at 30 April 2017 was £405.40.  An analysis of performance is provided in the Chairman's Statement and Investment Adviser's Report below.

·     Since PAT became independently managed in 1990 its NAV has increased by 603.5% compared to the FTSE All-Share's 279.9% and the RPI's 116.3%.

Capital returns to 30 April 2017:

	3 Years	5 Years	10 Years	Since 1990
NAV	19.5%	18.8%	50.6%	603.5%
FTSE All-Share	9.5%	32.8%	18.1%	279.9%
RPI	5.8%	11.6%	31.7%	116.3%

·     During the year the Company's shares continued to trade close to NAV. The Company issued 212,256 Ordinary shares, reissued 7,890 Ordinary shares from Treasury and purchased 4,861 Ordinary shares to be held in Treasury.

·      During the year, PAT continued to maintain a high level of liquidity. At 30 April 2017, liquidity was 54.3%. This included 20.9% in UK T-Bills, UK cash and cash equivalents and net current assets and 33.4% in various classes of non-equity risk assets: 19.3% in US TIPS; 10.0% in Gold Bullion; and 4.1% in UK Index-Linked Gilts. This compared to holdings as at 30 April 2016 of 22.6% in UK T-Bills, UK cash and cash equivalents, and net current assets and 33.4% in various classes of non-equity risk assets: 17.0% in US TIPS; 11.0% in Gold Bullion; 1.0% in overseas cash and cash equivalents; and 4.4% in UK Index-Linked Gilts.

·      Dividends are paid in July, October, January and April of each year. The first interim dividend of £1.40 per Ordinary share will be paid to shareholders on 14 July 2017. Barring unforeseen circumstances, three further interim dividends of £1.40 per Ordinary share are expected to be paid to shareholders in the year ending 30 April 2018, totalling £5.60 for the year.

The Chairman, Hamish Buchan, said:

"Our investment policy is to protect and increase (in that order) the value of shareholders' funds per share (otherwise known as net asset value per share, or "NAV") over the long term. To borrow a turn of speech from Mrs May, the long term means the long term. We don't think of it as being over five years or even ten years. To us, it means going back to 2000 or even to 1990, when Personal Assets became self-managed and so began its existence in its present form. Since 30 April 1990, the NAV has risen at an annual compound rate of 7.5% compared to 5.1% for the FTSE All-Share Index and 2.9% for the RPI. (The rise in share price at an annual compound rate of 9.0% is because at 30 April 1990 the shares sold at a discount to NAV of 30.2%.) On 30 April 1990 Personal Assets' share price, after adjusting for the 1 for 100 consolidation in January 1993, was £39.50 and it's therefore pleasing (although not particularly important) to note that during April 2017 the share price touched an all-time high of £410.70, falling back slightly to end our financial year at £405.40.

Last year I mentioned that the Board was giving thought to how best to measure how we have performed in pursuit of our stated objective and then communicate the results to you, the owners of the Company. The Board is still working on this, but for some years now we have ceased to use total return as a key performance indicator and in future we may drop it altogether from the Annual Report. We have also become more sparing in the use of the FTSE All-Share and instead have highlighted the RPI as a measure of how we are succeeding in protecting the real value of shareholders' funds.

To measure how Personal Assets protects and then, if possible, increases shareholders' funds per share the Board looks at investment performance from two angles-the result achieved, and the degree of risk accepted in achieving it. The result achieved is shown in Key Features on page 1 while the degree of risk accepted is indicated in the bottom chart on page 10. This shows how over the past seventeen years Personal Assets has been not only less volatile than UK equities in general but also less volatile than most investment trusts in the AIC Global Sector, in which we were included until December 2015, and the AIC Flexible Sector, in which we have been included since January 2016.

Last year I reported that as a result of the change in the Articles of Association to permit the Company to distribute realised profit as dividend the Board had been able to commit to paying the dividend at the present annual rate of £5.60 per share for the foreseeable future without interfering with the balance and composition of our investment portfolio. In the year to 30 April 2016 we drew on realised profits for this purpose to the extent of £735,000. I am pleased to report that in the current year the dividend has been fully covered by revenue earnings and we have been able to transfer £1,128,000 to reserves, thereby 'repaying' the amount withdrawn from reserves last year.

During the year we bought 4,861 shares to be held in Treasury for a total consideration of £1.8 million and issued or sold from Treasury 220,146 shares for a total consideration of £87.6 million. It is the policy of the Board that our shares should at all times be readily realisable by individual holders at as close as possible to their net asset value, and it is satisfying to report that since 8 November 1999, 'Discount Freedom Day', when investment trusts were empowered to use capital to buy back shares and hence to control the discount to net assets at which their shares sell, Personal Assets' share price has risen almost exactly in line with shareholders' funds per share while the number of shares outstanding has risen by more than five times, from 369,121 to 1,960,127.

In June last year the UK voted to leave the European Union. Whatever one thinks of the decision itself, there is no denying that the stock market welcomed the result of the vote-or, perhaps more accurately, it welcomed the fall in Sterling which it precipitated. This June we face a General Election. Anything can happen after a year which gave us Brexit and President Trump, and the Board is taking nothing for granted.

Last year I welcomed Jean Sharp to the Board and we have already benefited from her fresh thinking and incisive contributions to our debates. This year we bid farewell to Stuart Paul, who is retiring after eight years as a Director. Personal Assets owes him a great debt for his stimulating and provocative insights. We shall miss him in our deliberations and we wish him well for the future."

The Investment Adviser, Sebastian Lyon, said:

"Over the past three years Personal Assets Trust's net asset value per share ("NAV") has made steady, if unspectacular, progress. During this year's strong market our NAV rose by 8.6% while the FTSE All-Share Index ("our comparator" or "the index") was up by 15.8%. In the weaker market conditions of the two years to 30 April 2016 our NAV also rose, gaining 4.8% and 5.0% respectively compared to the 3.9% gain and 9.0% loss by our comparator. This demonstrates yet again how the distribution of our investments, which differs widely from that of the index, so often makes the comparison (whether on the upside or the downside) less than helpful. Our priority is to preserve and grow capital, in that order, and Personal Assets has never invested with reference to the index. Last year's NAV return was generated at a time when, for reasons of caution, we had materially less than 50% of shareholders' funds invested in equities. Until we are more fully invested, our returns are likely to continue to differ markedly from those of the stock market.

In the past year, much has changed from a political standpoint (such as Britain's decision to leave the EU and the election of Donald Trump) but little has changed from an economic standpoint and nothing has changed regarding our main concern-the valuations of asset classes. These are more stretched than ever, particularly after the 'Brexit boom' in UK share prices, and it all feels very 'late cycle'. While at 96 months the US stock market has enjoyed the second longest bull market since 1945 (according to Fortune), it doesn't 'feel' like a bubble. Today's mood music is elevator musak rather than heavy metal. Most investors we talk to are not thinking bullishly, but are acting bullishly. The disappearance of income from traditional safe-haven assets such as cash and government bonds has led income-conscious investors to chase yield in the manner of a relay race, when, after each lap, savers and investors have to change to the outside lane and reach out further across the risk asset class spectrum. Traditional measures of valuation insist that equities, led by US indices, are expensive by historical standards. The US market's cyclically adjusted price earnings ("CAPE") ratio is currently 29.2x compared to its long term average of 16.8x, a level only 'bettered' by the levels at the end of the 'Roaring Twenties' and on the eve of the 2000 implosion of technology stocks.

Amid the dearth of attractive opportunities, portfolio turnover last year was minimal. We added to American Express, Berkshire Hathaway and A.G. Barr and added a new holding in Franco-Nevada while reducing British American Tobacco after years of very strong performance. A.G. Barr's share price had been the victim of a confluence of negative issues. Some of these will prove temporary - it will not always rain in Glasgow - while others, such as the introduction of the proposed sugar levy in the UK, should prove manageable. We bought the shares at a much lower valuation than that which prevailed just a few years ago. Franco-Nevada is a precious metals royalty company, so receives payment from other companies' mine production. The company's entrepreneurial management team has an excellent track record in investing counter-cyclically and prides itself on maintaining a 'fortress' balance sheet.

Valuation as an indicator of future return is important to us because it is one of the few inputs we don't have to predict. When virtually all asset classes are overvalued, only high levels of liquidity will help us avoid the coming falls. This is because, with both conventional bonds and equities looking expensive, traditional diversification may not protect to the extent that it did in the past while paying for protection through options is still expensive, and once options expire the capital has gone. Our preference is to hold our portfolio insurance in the form of gold. This should act as a long duration hedge, protecting us from the currently unanticipated risk of inflation or deflation. Moreover, gold benefits from being no one else's liability, so there is no counterparty risk.

While other investors are ever more tempted to increase risk, our role as prudent asset allocators is to do the opposite. The Company's allocation to risk assets is relatively low. Our emphasis remains on quality in equities and on short duration index-linked bonds. Waiting for the prospect of higher returns requires much discipline and patience. As Jean-Jacques Rousseau, the eighteenth century Swiss polymath, wryly noted, 'Patience is bitter, but its fruit is sweet'."

For further information contact:

Robin Angus

Executive Director

Tel:  [phone]

Sebastian Lyon

Investment Adviser

Tel:  [phone]

Steven Davidson

Company Secretary

Tel:  [phone]

The Group's Income Statement, Group and Company Statements of Financial Position, Group and Company Statements of Changes in Equity and Group and Company Cash Flow Statements follow.

Group Income Statement

	Year ended 30 April 2017
	Revenue	Capital
	return	return	Total
	£'000	£'000	£'000
Income
Investment income	15,088	-	15,088
Other operating income	751	-	751
	15,839	-	15,839
Gains on investments held at fair value through profit or loss	-	83,454	83,454
Foreign exchange losses	-	(26,403)	(26,403)
Total income	15,839	57,051	72,890
Expenses	(3,716)	(3,139)	(6,855)
Profit before taxation	12,123	53,912	66,035
Taxation	(685)	-	(685)
Profit for the year	11,438	53,912	65,350
Return per share	£6.20	£29.25	£35.45
The "Profit for the Year" is also the "Total Comprehensive Income for the Year", as defined in IAS1 (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 International Financial Reporting Standards as adopted by the European Union ("IFRSs").  The Revenue and Capital return columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies. Return per share is calculated on 1,843,254 (2016: 1,726,867) shares, being the weighted average number in issue (excluding Treasury shares) during the year. All items in the above statement derive from continuing operations.
Dividend Information	2017		2016
Dividends per share	£5.60		£5.60
Dividends paid	£'000		£'000
First interim dividend of £1.40 per share (2016: £1.40 per share)	2,448		2,447
Second interim dividend of £1.40 per share (2016: £1.40 per share)	2,529		2,440
Third interim dividend of £1.40 per share (2016: £1.40 per share)	2,630		2,424
Fourth interim dividend of £1.40 per share (2016: £1.40 per share)	2,703		2,380
	10,310		9,691

Group Income Statement

	Year ended 30 April 2016
	Revenue	Capital
	return	return	Total
	£'000	£'000	£'000
Income
Investment income	11,283	-	11,283
Other operating income	619	-	619
	11,902	-	11,902
Gains on investments held at fair value through profit or loss	-	41,467	41,467
Foreign exchange losses	-	(8,475)	(8,475)
Total income	11,902	32,992	44,894
Expenses	(3,054)	(2,691)	(5,745)
Profit before taxation	8,848	30,301	39,149
Taxation	(594)	-	(594)
Profit for the year	8,254	30,301	38,555
Return per share	£4.78	£17.55	£22.33

Group Statement of Financial Position

			As at 30 April 2017			As at 30 April 2016
			£'000			£'000
Non-current assets
Investments held at fair value though profit or loss			733,479			599,789
Current assets
Financial assets held at fair value though profit or loss			10,666			2,896
Receivables			5,052			1,963
Cash and cash equivalents			34,926			37,278
Total Assets			784,123			641,926
Current liabilities
Payables			(2,624)			(1,302)
Total liabilities			(2,624)			(1,302)
Net assets			781,499			640,624
Capital and reserves
Ordinary share capital			24,502			21,848
Share premium			488,444			406,302
Capital redemption reserve			219			219
Special reserve			22,517			22,517
Treasury share reserve			-			(1,039)
Capital reserve			244,655			190,743
Revenue reserve			1,162			34
Total equity			781,499			640,624
Shares in issue at year end			1,960,127			1,744,842
Net asset value per Ordinary share			£398.70			£367.15

Company Statement of Financial Position

			As at 30 April 2017			As at 30 April 2016
			£'000			£'000
Non-current assets
Investments held at fair value through profit or loss			733,966			600,173
Current assets
Financial assets held at fair value through profit or loss			10,666			2,896
Receivables			5,002			1,918
Cash and cash equivalents			34,495			36,913
Total Assets			784,129			641,900
Current liabilities
Payables			(2,630)			(1,276)
Total liabilities			(2,630)			(1,276)
Net assets			781,499			640,624
Capital and reserves
Ordinary share capital			24,502			21,848
Share premium			488,444			406,302
Capital redemption reserve			219			219
Special reserve			22,517			22,517
Treasury share reserve			-			(1,039)
Capital reserve			244,692			190,777
Revenue reserve			1,125			-
Total equity			781,499			640,624
Shares in issue at year end			1,960,127			1,744,842
Net asset value per Ordinary share			£398.70			£367.15

Group and Company Statement of Changes in Equity *

For the year ended 30 April 2017	Ordinary share capital	Share premium	Capital redemption reserve	Special reserve	Treasury share reserve	Capital reserve‡	Revenue reserve	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Balance as at 30 April 2016	21,848	406,302	219	22,517	(1,039)	190,743	34	640,624
Profit for the year	-	-	-	-	-	53,912	11,438	65,350
Ordinary dividends paid	-	-	-	-	-	-	(10,310)	(10,310)
Issue and reissue of Ordinary shares	2,654	82,142	-	-	2,837	-	-	87,633
Buybacks of Ordinary shares	-	-	-	-	(1,798)	-	-	(1,798)
Balance as at 30 April 2017	24,502	488,444	219	22,517	-	244,655	1,162	781,499
For the year ended 30 April 2016	Ordinary share capital	Share premium	Capital redemption reserve	Special reserve	Treasury share reserve	Capital reserve	Revenue reserve	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Balance as at 30 April 2015	21,845	404,762	219	22,517	(1,511)	161,177	736	609,745
Profit for the year	-	-	-	-	-	30,301	8,254	38,555
Ordinary dividends paid	-	-	-	-	-	(735)	(8,956)	(9,691)
Issue and reissue of Ordinary shares	3	1,540	-	-	18,917	-	-	20,460
Buybacks of Ordinary shares	-	-	-	-	(18,445)	-	-	(18,445)
Balance as at 30 April 2016	21,848	406,302	219	22,517	(1,039)	190,743	34	640,624

* The Company's reserves are the same as the Group's other than the Capital Reserve, which is £244,692,000 (2016: £190,777,000), and the Revenue Reserve, which is £1,125,000 (2016: £nil). The differences relates to the profit generated by the Company's subsidiary.

‡ The Group and Company Capital reserve at 30 April 2017 includes realised capital reserves of £27,189,000 (2016: £62,486,000).

Share premium. The share premium represents the difference between the nominal value of new Ordinary shares issued and the consideration the Company receives for these shares.

Capital redemption reserve. The capital redemption reserve represents the nominal value of Ordinary shares bought back for cancellation since authority to do this was first obtained at a General Meeting in April 1999.

Special reserve. The cost of any shares bought back for cancellation is deducted from the special reserve, which is a distributable reserve and was created from the share premium, also following a General Meeting in April 1999.

Treasury share reserve. The net cost of any shares bought back to be held in Treasury.

Capital reserve. Gains and losses on the realisation of investments, gains and losses on the realisation of FTSE 100 Future contracts, realised exchange differences of a capital nature and returns of capital are accounted for in this Reserve. Increases and decreases in the valuation of investments held at the year end, unrealised gains and losses on FTSE 100 Future contracts and unrealised exchange differences of a capital nature are also accounted for in this Reserve.

Revenue reserve. Any surplus/deficit arising from the revenue profit/loss for the year is taken to/from this Reserve.

Group Cash Flow Statement

	Year Ended 30 April	Year Ended 30 April
	2017	2016
	£'000	£'000
Cash flows from operating activities
Profit before taxation	66,035	39,149
Gains on investments including effective yield	(87,954)	(43,230)
Foreign exchange losses	26,403	8,475
Operating cash flows before movements in working capital	4,484	4,394
Increase in other receivables	(84)	(150)
Increase in other payables	184	55
Net cash from operating activities before taxation	4,584	4,299
Taxation	(895)	(750)
Net cash inflow from operating activities	3,689	3,549
Investing activities
Purchases of investments - equity shares	(15,977)	(21,283)
Purchases of investments - fixed interest and other investments	(569,673)	(418,189)
Disposal of investments - equity shares	1,914	14,941
Disposal of investments - fixed interest and other investments	537,000	454,792
Forward foreign exchange losses	(34,710)	(4,747)
Net cash (outflow)/inflow from investing activities	(81,446)	25,514
Financing activities
Equity dividends paid	(10,310)	(9,691)
Issue of Ordinary shares	83,846	101
Cost of share buybacks	(1,798)	(18,445)
Reissue of Ordinary shares from Treasury	3,130	20,287
Net cash inflow/(outflow) from financing activities	74,868	(7,748)
(Decrease)/increase in cash and cash equivalents	(2,889)	21,315
Cash and cash equivalents at the start of the year	37,278	15,844
Effect of foreign exchange rate changes	537	119
Cash and cash equivalents at the end of the year	34,926	37,278
Net cash inflow from operating activities includes the following:
Dividends received	9,233	7,891
Interest received	1,320	1,691

Company Cash Flow Statement

	Year Ended 30 April	Year Ended 30 April
	2017	2016
	£'000	£'000
Cash flows from operating activities
Profit before taxation	66,032	39,146
Gains on investments including effective yield	(87,954)	(43,230)
Foreign exchange losses	26,403	8,475
Operating cash flows before movements in working capital	4,481	4,391
Increase in other receivables	(79)	(131)
Increase in other payables	216	61
Net cash from operating activities before taxation	4,618	4,321
Taxation	(895)	(750)
Net cash inflow from operating activities	3,723	3,571
Investing activities
Purchases of investments - equity shares	(16,077)	(21,283)
Purchases of investments - fixed interest and other investments	(569,673)	(418,189)
Disposal of investments - equity shares	1,914	14,941
Disposal of investments - fixed interest and other investments	537,000	454,792
Forward foreign exchange losses	(34,710)	(4,747)
Net cash (outflow)/inflow from investing activities	(81,546)	25,514
Financing activities
Equity dividends paid	(10,310)	(9,691)
Issue of Ordinary shares	83,846	101
Cost of share buybacks	(1,798)	(18,445)
Reissue of Ordinary shares from Treasury	3,130	20,287
Net cash inflow/(outflow) from financing activities	74,868	(7,748)
(Decrease)/increase in cash and cash equivalents	(2,955)	21,337
Cash and cash equivalents at the start of the year	36,913	15,457
Effect of foreign exchange rate changes	537	119
Cash and cash equivalents at the end of the year	34,495	36,913

Net cash inflow from operating activities includes the following:
Dividends received	9,233	7,891
Interest received	1,320	1,691

Principal Risks and Risk Management

The Board believes that the principal risks to shareholders, which it seeks to mitigate through continual review of its investments and through shareholder communication, are events or developments which can affect the general level of share prices, including, for instance, inflation or deflation, economic recessions and movements in interest rates and currencies.

Other risks faced by the Company include breach of regulatory rules which could lead to suspension of the Company's Stock Exchange listing, financial penalties, or a qualified audit report. Breach of Section 1158 of the Corporation Tax Act 2010 could lead to the Company being subject to tax on capital gains.

In the mitigation and management of these risks, the Board regularly monitors the investment environment and the management of the Company's investment portfolio, and applies the principles detailed in the guidance provided by the Financial Reporting Council.

Statement of Directors' Responsibilities in Respect of the Annual Financial Report

In accordance with the Disclosure Guidance and Transparency Rules, we confirm that to the best of our knowledge:

·      The financial statements contained within the Annual Report for the year ended 30 April 2017, of which this statement of results is an extract, have been prepared in accordance with applicable International Financial Reporting Standards as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group and the undertakings included in the consolidation taken as a whole; and

·      The Strategic Report includes a fair review of the development and performance of the business and the position of the Group and the undertakings included in the consolidation taken as a whole together with a description of the principal risks and uncertainties that it faces.

Going Concern

The Directors believe, in the light of the controls and review processes reported in the Report of the Audit Committee on page 28 of the Annual Report and bearing in mind the nature of the

Group's business and assets, which are considered to be readily realisable if required, that the Group has adequate resources to continue operating for at least twelve months from the date of approval of the financial statements. For this reason, they continue to adopt the going concern basis in preparing the accounts.

Related Party Transactions

The Company pays £30,000 per annum for the rental of the Executive Office to Rushbrook & Co LLP, of which Frank Rushbrook is a partner. The notice period on the lease is six months. No amount was outstanding at the year end.

Investment advisory services are provided by Troy Asset Management Limited. The investment advisory fee for the year ended 30 April 2017 was £4,829,000 (2016: £4,140,000). An amount of £1,249,000 was outstanding to the Investment Adviser at 30 April 2017 (2016: £1,080,000).

Secretarial and administrative services are provided by the Company's wholly owned subsidiary, PATAC Limited. Costs, net of third party income, amounted to £250,000 (2016: £250,000) in respect of these services in the year to 30 April 2017. No amounts were outstanding at the year end.

Directors of the Company received fees for their services. An amount of £10,000 was outstanding to the Directors at 30 April 2017 (2016: £13,000). Further details are provided in the Directors' Remuneration Report on pages 24 and 25 of the Annual Report. The Directors' shareholdings are also detailed on pages 21 and 24 of the Annual Report.

Notes:

1.         The financial statements of the Group have been prepared in accordance with International Financial Reporting Standards (''IFRSs''). These comprise standards and interpretations approved by the International Accounting Standards Board (''IASB''), together with such interpretations by the International Accounting Standards and Standing Interpretations Committee as have been approved by the IASB and still remain in effect, to the extent that these have been adopted by the European Union.

The financial statements are presented in Sterling and all values are rounded to the nearest thousand pounds (£'000) except where otherwise indicated.

The principal accounting policies adopted are set out in pages 15 and 16 of the Annual Report. Where the presentational guidance set out in the Statement of Recommended Practice (the ''SORP'') for investment trusts issued by the Association of Investment Companies (the ''AIC'') in November 2014 is consistent with the requirements of IFRSs, the Directors have sought to prepare the financial statements on a basis compliant with the recommendation of the SORP.

Certain new standards, including IFRS 9 Financial Instruments and IFRS 15 Revenue from Contracts with Customers, have been issued but are not effective for this accounting period. These have not been adopted early and the Group does not consider that the future adoption of any new standards, in the form currently available, will have any material impact on the financial position and performance as presented.

2.         During the year the Directors issued 212,256 new Ordinary shares and reissued 7,890 Ordinary shares from Treasury for proceeds of £87,633,000. The Company also purchased 4,861 Ordinary shares to be held in Treasury for a total consideration of £1,798,000.

3.         At 30 April 2017 the sterling value of the US Treasury stocks and part of the US equities were protected by a forward currency contract.

4.         The Group held the following categories of financial instruments as at 30 April 2017:

	Level 1 £'000	Level 2 £'000	Level 3 £'000	Total £'000
Investments	733,479	-	487	733,966
Financial Assets	-	10,666	-	10,666
Total	733,479	10,666	487	744,632

The above table provides an analysis of investments based on the fair value hierarchy described below and which reflects the reliability and significance of the information used to measure their fair value. The levels are determined by the lowest (that is, the least reliable or least independently observable) level of impact that is significant to the fair value measurement for the individual investment in its entirety as follows:

Level 1 reflects financial instruments quoted in an active market. The Company's investment in Gold Bullion has been included in this level.

Level 2 reflects financial instruments the fair value of which is evidenced by comparison with other observable current market transactions in the same instrument or based on a valuation technique the variables of which include only data from observable markets. The Company's forward currency contract has been included in this level as fair value is achieved using the foreign exchange spot rate and forward points which vary depending on the duration of the contract.

Level 3 reflects financial instruments the fair value of which is determined in whole or in part using a valuation technique based on assumptions that are not supported by prices from observable market transactions in the same instrument and not based on available observable market data. The Company's subsidiary has been included in this level as its valuation is based on its net assets. A reconciliation of Level 3 fair value measurements of financial assets can be found below.

                                                                                                                           (Level 3)

                                                                                                                              £'000

Opening book cost	350
Opening unrealised appreciation	34
Opening valuation	384
Movement in the year:
Purchases at cost	100
Unrealised profit on the fair value of investments during the year	3
Closing valuation at 30 April 2017	487
Closing book cost	450
Closing unrealised appreciation	37
Closing valuation at 30 April 2017	487

5.         These are not statutory accounts in terms of Section 434 of the Companies Act 2006.  Full audited accounts for the year to 30 April 2017 will be sent to shareholders in June 2017 and will be available for inspection at 10 St Colme Street, Edinburgh, the registered office of the Company. The full annual report and accounts will be available on the Company's website www.patplc.co.uk.

6.         The audited accounts for the year ended 30 April 2017 will be lodged with the Registrar of Companies.

 

END

 

 

FR SSAFMFFWSEFM