Final Results

RNS Number : 8155X

Rights and Issues Inv Trust PLC

21 February 2012

RIGHTS AND ISSUES INVESTMENT TRUST PUBLIC LIMITED COMPANY

CHAIRMAN'S STATEMENT

2011 was a year of sharp contrasts. The optimism of the opening six months gave way to a much darker mood in the second half as the Euro crisis developed. In particular, there was a sharp downwards revision of growth expectations for the Euro Zone economies with inevitable ramifications for the UK economy and its growth prospects.

The FTSE All-Share Index recorded a fall of 7.6%. Smaller companies fared much worse with average falls for the smaller cap indices of 15%. The modest outperformance by smaller companies in the first half was replaced by a 10% underperformance in the latter six months. Such a reversal often accompanies a rapid decline in economic expectations and is partly caused by a flight to safety and partly caused by a perception of the higher exposure of smaller companies to local economic conditions.

The net asset value of the capital shares declined from 3105.7p to 3004.6p and that of the income shares reduced from 752.9p to 735.2p. These are falls of 3.3% and 2.4% respectively. After the strong performance of the Trust in the first six months, these full year results are modestly disappointing though still comfortably ahead of The FTSE All-Share Index performance.

Without the benefit of stock profits, Discretionary Unit Fund Managers recorded pre-tax profits of just over £100,000.

Your Directors are maintaining dividends at 25.5p per income share and 1.275p per capital share. This may seem a small achievement but for the first time since 2007 these dividends are fully covered by profits. Additionally, the supplementary capital dividend of 68.6829p was paid on 2nd January, 2012 and barring unforeseen circumstances, will be increased to 69.4878p per capital share payable on 2nd January, 2013. This 1.2% rise reflects the moderate capital profits realised during the year.

There have been a number of changes to the Board during the year with David Best and Jonathan Roper joining and Brian Beverley recently retiring after serving for over two decades. Also it is with sadness that I have to record the death of Simon Knott in November. Simon served firstly as a Director of the Trust for many years and then as Chairman for twenty-seven years. He will be missed by us all.

The outlook for 2013 is very mixed: The Euro Zone may fall into recession. The UK economy will at best see anaemic growth. United States does however now seem to be on its way to a reasonable recovery and the Asian economies will continue to expand. Recent company results remain encouraging and the Trust has seen a good first six weeks.

D. M. BRAMWELL

Chairman

You can view or download copies of the Half Year and Annual reports from our website at www.rightsandissues.co.uk.

They are to be posted to shareholders and are available at the registered office of the Company.

Risks and uncertainties

Cautionary statement

This report contains forward-looking statements that involve risk and uncertainty. These have been made by the directors in good faith based on the information available to them at the time of their approval of this report. Due to the inherent uncertainties, including stock market risk factor, actual results may differ materially from those expressed or implied by these forward-looking statements.

Further information on the principal long-term risks and uncertainties of the Trust is included in the annual report.

RIGHTS AND ISSUES INVESTMENT TRUST PUBLIC LIMITED COMPANY

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The Directors are responsible for preparing the annual report and accounts in accordance with applicable United Kingdom law and International Financial Reporting Standards (IFRS) as adopted by the European Union.

The Directors are required to prepare the accounts for each financial year which present fairly the financial position of the Group and the financial performance and cashflows of the Company and the Group for that period. In preparing those Accounts the Directors are required to:

·	select suitable accounting policies and then apply them consistently;

·	make judgements and estimates that are reasonable and prudent;

·	present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;

·	provide additional disclosures when compliance with the specific requirements of IFRS is insufficient to enable users to understand the impact of particular transactions, other events and conditions on the group's financial position and financial performance;

·	state that the Company has complied with IFRS subject to any material departures disclosed and explained in the accounts; and

·	prepare the accounts on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the Accounts comply with the Companies Act 2006 and Article 4 of the IAS regulation. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Under applicable law and regulations, the Directors are also responsible for preparing a Directors' Report, Directors' Remuneration Report and the Corporate Governance Statement that comply with that law and those regulations.

The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website. Visitors to the website need to be aware that legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

The directors confirm that to the best of their knowledge that:

·	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 group; and

·	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 they face.

D. M. Bramwell, Director

S. J. B. Knott, Director	21st February, 2012

RIGHTS AND ISSUES INVESTMENT TRUST PUBLIC LIMITED COMPANY

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

for the year ended 31st December, 2011

		Year ended 31st December, 2011			Year ended 31st December, 2010
	Notes	Revenue	Capital	Total	Revenue	Capital	Total
		£	£	£	£	£	£
Investment income	2	2,157,373	-	2,157,373	1,724,112	-	1,724,112
Other operating income	2	308,100	-	308,100	256,115	-	256,115
Total income		2,465,473	-	2,465,473	1,980,227	-	1,980,227
Gains/(Losses) on investments held at fair value through profit or loss	10	(18,345)	(2,217,348)	(2,235,693)	159,456	20,721,113	20,880,569
		2,447,128	(2,217,348)	229,780	2,139,683	20,721,113	22,860,796

Expenses
Investment management fee		-	-	-	-	-	-
Other expenses	3	539,079	-	539,079	531,960	-	531,960
		539,079	-	539,079	531,960	-	531,960

Profit/(Loss) before tax		1,908,049	(2,217,348)	(309,299)	1,607,723	20,721,113	22,328,836
Tax	5	-	-	-	-	-	-
Profit for the period		1,908,049	(2,217,348)	(309,299)	1,607,723	20,721,113	22,328,836

Earnings per share
Return per income share (p)	7	30.3p	(22.5)p	7.8p	18.5p	210.6p	229.1p
Return per capital share (p)	7	70.2p	(101.4)p	(31.2)p	69.6p	947.6p	1017.2p

The total column of this statement represents the Consolidated Statement of Comprehensive Income, prepared in accordance with IFRS. The supplementary revenue return and capital return columns are both prepared under guidance published by the Association of Investment Companies. All items in the above statement derive from continuing operations.

All income is attributable to the equity holders of the parent company. There are no minority interests.

RIGHTS AND ISSUES INVESTMENT TRUST PUBLIC LIMITED COMPANY

CONSOLIDATED AND PARENT COMPANY BALANCE SHEETS

as at 31st December, 2011

		Company		Group
	Notes	2011	2010	2011	2010
		£	£	£	£
Non-current assets
Goodwill	8	-	-	65,191	65,191
Investments - Fair value through profit or loss	10	64,219,909	62,861,280	63,788,437	62,429,808
		64,219,909	62,861,280	63,853,628	62,494,999
Current assets
Trading investments		-	-	649,857	650,233
Trade and other receivables	14	415,102	310,904	443,655	400,967
Current tax receivable		20,616	49,610	-	-
Amounts due from group undertakings		609,903	1,191,706	-	-
Cash and cash equivalents		2,456,505	5,433,124	2,907,025	6,386,189
		3,502,126	6,985,344	4,000,537	7,437,389
Total assets		67,722,035	69,846,624	67,854,165	69,932,388
Current liabilities
Trade and other payables	15	41,479	71,159	294,705	278,019
Current tax payable		-	-	-	-
		41,479	71,159	294,705	278,019
Total assets less current liabilities		67,680,556	69,775,465	67,559,460	69,654,369
Net assets		67,680,556	69,775,465	67,559,460	69,654,369
Equity
Called up share capital	16	1,225,000	1,225,000	1,225,000	1,225,000
Share premium account	17	225,326	225,326	225,326	225,326
Retained reserves:
Capital reserve	17	41,611,944	39,952,082	41,611,944	39,952,082
Revaluation reserve	17	23,259,244	27,136,454	23,259,244	27,136,454
Dividend equalisation reserve	17	1,359,042	1,236,603	1,237,946	1,115,507
Total equity		67,680,556	69,775,465	67,559,460	69,654,369
Net asset value per share
Income shares				735.2p	752.9p
Capital shares				3004.6p	3105.7p

The financial statements were approved by the board and authorised for issue on 21st February, 2012. They were signed on its behalf by:

D. M. Bramwell, Director

S. J. B. Knott, Director	Company Registration Number: 736898

RIGHTS AND ISSUES INVESTMENT TRUST PUBLIC LIMITED COMPANY

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

for the year ended 31st December, 2011

		Share			Dividend
	Share	premium	Capital	Revaluation	equalisation
	capital	account	reserve	reserve	reserve	Total
	£	£	£	£	£	£
Balance at 31st December, 2009	1,225,000	225,326	37,150,280	9,217,143	1,293,394	49,111,143
Changes in equity for 2010
Profit/(Loss) for the period	-	-	2,801,802	17,919,311	1,607,723	22,328,836
Total recognised income and expense	1,225,000	225,326	39,952,082	27,136,454	2,901,117	71,439,979
Dividends	-	-	-	-	(1,785,610)	(1,785,610)
Balance at 31st December, 2010	1,225,000	225,326	39,952,082	27,136,454	1,115,507	69,654,369

Changes in equity for 2011
Profit/(Loss) for the period	-	-	1,659,862	(3,877,210)	1,908,049	(309,299)
Total recognised income and expense	1,225,000	225,326	41,611,944	23,259,244	3,023,556	69,345,070
Dividends	-	-	-	-	(1,785,610)	(1,785,610)
Balance at 31st December, 2011	1,225,000	225,326	41,611,944	23,259,244	1,237,946	67,559,460

COMPANY STATEMENT OF CHANGES IN EQUITY

for the year ended 31st December, 2011

		Share			Dividend
	Share	premium	Capital	Revaluation	equalisation
	capital	account	reserve	reserve	reserve	Total
	£	£	£	£	£	£
Balance at 31st December, 2009	1,225,000	225,326	37,150,280	9,217,143	1,414,490	49,232,239
Changes in equity for 2010
Profit/(Loss) for the period	-	-	2,801,802	17,919,311	1,607,723	22,328,836
Total recognised income and expense	1,225,000	225,326	39,952,082	27,136,454	3,022,213	71,561,075
Dividends	-	-	-	-	(1,785,610)	(1,785,610)
Balance at 31st December, 2010	1,225,000	225,326	39,952,082	27,136,454	1,236,603	69,775,465

Changes in equity for 2011
Profit/(Loss) for the period	-	-	1,659,862	(3,877,210)	1,908,049	(309,299)
Total recognised income and expense	1,225,000	225,326	41,611,944	23,259,244	3,144,652	69,466,166
Dividends	-	-	-	-	(1,785,610)	(1,785,610)
Balance at 31st December, 2011	1,225,000	225,326	41,611,944	23,259,244	1,359,042	67,680,556

RIGHTS AND ISSUES INVESTMENT TRUST PUBLIC LIMITED COMPANY

CASH FLOW STATEMENTS

for the year ended 31st December, 2011

			Company		Group
	Notes	2011	2010	2011	2010
		£	£	£	£
Cashflows from operating activities
(Loss)/Profit before tax		4,104,781	22,279,226	4,125,397	22,328,836
Adjustments for:
Losses/(Gains) on investments		(2,217,348)	(20,721,113)	(2,217,348)	(20,721,113)
Purchases of investments		(7,189,016)	(5,426,717)	(7,189,016)	(5,426,717)
Proceeds on disposal of investments		3,613,039	7,712,079	3,613,039	7,712,079
Movement in trading investments		-	-	376	(151,655)

Operating cash flows before movements in working capital		(1,688,544)	3,843,475	(1,667,552)	3,741,430
Decrease/(increase) in receivables		477,605	(315,270)	(42,688)	(156,327)
Increase/(decrease) in payables		(29,680)	30,564	16,686	116,293

Net cash from operating activities before income taxes		(1,240,619)	3,558,769	(1,693,554)	3,701,396
Income taxes received/(paid)		49,610	29,291	-	-
Net cash from operating activities		(1,191,009)	3,588,060	(1,693,554)	3,701,396

Cash flows from financing activities
Dividends paid		(1,785,610)	(1,785,610)	(1,785,610)	(1,785,610)
Net cash (used in)/from financing activities		(1,785,610)	(1,785,610)	(1,785,610)	(1,785,610)
Net increase/(decrease) in cash and cash equivalents		(2,976,619)	1,802,450	(3,479,164)	1,915,786
Cash and cash equivalents at beginning of year		5,433,124	3,630,674	6,386,189	4,470,403
Cash and cash equivalents at end of year		2,456,505	5,433,124	2,907,025	6,386,189

RIGHTS AND ISSUES INVESTMENT TRUST PUBLIC LIMITED COMPANY

NOTES TO THE ACCOUNTS

for the year ended 31st December, 2011

1. The figures set out above are derived from the audited consolidated accounts of Rights and Issues Investment Trust Plc and its subsidiaries for the years ended 31 December 2010 and 31 December 2011. The 2011 accounts will be sent to shareholders shortly.

2. The financial information contained in this announcement does not constitute statutory accounts within the meaning of section 435 of the Companies Act 2006. The 2010 accounts, on which the report of the auditors is unqualified, will be filed with the Registrar of Companies in due course. The audited accounts for the year ended 31 December 2010 on which the report of the auditors contained no qualification or statement under either Section 498(2),(3)or (4) of the Companies Act 2006, have been filed with the Registrar of Companies.

3. DIVIDENDS AND OTHER APPROPRIATIONS

Amounts recognised as distributions to equity holders in the period:

	2011	2010	2011	2010
	p	p	£	£
Income
Final dividend for the year ended 31st December, 2010	17.00	17.00	418,200	418,200
Interim dividend for the year ended 31st December, 2011	8.50	8.50	209,100	209,100
Capital
Final dividend for the year ended 31st December, 2010	1.2750	1.2750	20,910	20,910
Supp cap dividend for the year ended 31st December, 2011	68.6829	68.6829	1,126,400	1,126,400
			1,774,610	1,774,610
Dividends on non-equity shares:
Cumulative preference	5.5%	5.5%	11,000	11,000

The Articles provide for a supplementary Dividend to Capital Shareholders to be paid not only in respect of future potential Preference Share issues which are not made, but also the 20,720,000 Preference Shares which could have been issued following the increases in the Capital Reserve revealed by the accounts since 1981.

	2011	2010	2011	2010
	p	p	£	£
Income
Proposed final dividend for the year ended 31st December, 2011	17.00	17.00	418,200	418,200
Capital
Proposed final dividend for the year ended 31st December, 2011	1.2750	1.2750	20,910	20,910

The proposed final dividend is subject to approval by shareholders at the Annual General Meeting and has not been included as a liability in these financial statements.

RIGHTS AND ISSUES INVESTMENT TRUST PUBLIC LIMITED COMPANY

NOTES TO THE ACCOUNTS continued

for the year ended 31st December, 2011

3. DIVIDENDS AND OTHER APPROPRIATIONS (continued)

We also set out below the total dividend payable in respect of the financial year, which is the basis on which the requirements of S1158 CTA are considered.

	2011	2010	2011	2010
	p	p	£	£
Dividends on equity shares
Income
Interim dividend for the year ended 31st December, 2011	8.50	8.50	209,100	209,100
Proposed final dividend for the year ended 31st December, 2011	17.00	17.00	418,200	418,200
	25.50	25.50
Capital
Supp cap dividend for the year ended 31st December, 2011	68.6829	68.6829	1,126,400	1,126,400
Proposed final dividend for the year ended 31st December, 2011	1.2750	1.2750	20,910	20,910
	69.9579	69.9579	1,774,610	1,774,610