Final Results

RNS Number : 0462A

Rights and Issues Inv Trust PLC

13 February 2014

 



CHAIRMAN'S STATEMENT

2013 has proved to be a vintage year. After a modest first six months, a good third quarter was followed by an even better final three months. Shareholders' funds have achieved a new record level of £123m.

The stark contrast in performance between larger companies and smaller companies again manifested itself. The FTSE All-Share Index rose by 16.7%. The FTSE Small Cap Index increased by 29.6% and the FTSE Fledgling Index achieved a 35.8% improvement.

The Trust exceeded all these indices with the net asset value of the capital shares rising from 3848.1p to 5529.9p and that of the income shares from 935.0p to 1334.0p, increases of 43.7% and 42.7% respectively.

Discretionary Unit Fund Managers enjoyed a good year with pre-tax profits exceeding £350,000 boosted by investment dealings profits of over £200,000.

Your Directors have increased dividends by 12% to 30.0p per income share and 1.5p per capital share. The recent strong performance in capital growth is now generating good investment income growth which rose by 27% to £2.87m. Your Directors have also decided to declare a special dividend of 10.0p per income share and 0.5p per capital share in recognition of the Trust's recent fiftieth anniversary. This payment will be made at the same time as the final dividends. Additionally, the supplementary capital dividend of 81.8293p per capital share was paid on 2nd January 2014 and, barring unforeseen circumstances, will be increased to 86.3902p per capital share payable on 2nd January 2015.

There have been two major changes to the Trust during the last year with a modernisation of the Articles of Association in March and very recently the repayment of the preference shares.

After the strong end to 2013, the year has started on a more subdued note. Concerns have again arisen over the impact of the tapering of quantitative easing and the interest rate rises that will follow. However the UK economy is now in recovery mode and history would suggest that this should be helpful to UK smaller companies.

Dr 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.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The Directors are responsible for preparing the Annual Report and Financial Statements 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 Financial Statements 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 Financial Statements, 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 Financial Statements on the going concern basis unless it is inappropriate to presume that the Group 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, Strategic Report  and Directors' Remuneration Report 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 consider that the Annual Report and Financial Statements taken as a whole is fair, balanced and understandable and provides Shareholders with the information necessary to assess the Company's performance, business model and strategy.

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

·       the Financial Statements, 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 Group, together with a description of the principal risks and uncertainties that they face.

Dr D. M. Bramwell, Director
S. J. B. Knott, Director	13th February 2014

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 31st December 2013

				Year ended 31st December, 2013						Year ended 31st December, 2012
		Notes		Revenue £		Capital £		Total £		Revenue £		Capital £		Total £
Investment income		2		2,869,243		-		2,869,243		2,263,227		-		2,263,227
Other operating income		2		340,063		-		340,063		295,290		-		295,290
Total income				3,209,306		-		3,209,306		2,558,517		-		2,558,517
Gains/(Losses) on investments held at fair value through profit or loss		10		237,002		36,746,082		36,983,084		144,008		18,431,632		18,575,640
				3,446,308		36,746,082		40,192,390		2,702,525		18,431,632		21,134,157
Expenses
Investment management fee				-		-		-		-		-		-
Other expenses		3		738,842		-		738,842		584,795		-		584,795
				738,842		-		738,842		584,795		-		584,795
Profit/(loss) before tax				2,707,466		36,746,082		39,453,548		2,117,730		18,431,632		20,549,362
Tax		5		-		-		-		-		-		-
Profit for the period				2,707,466		36,746,082		39,453,548		2,117,730		18,431,632		20,549,362
Earnings per share
Return per income share (p)		7		53.3p		373.4p		426.7p		38.1p		187.3p		225.4p
Return per capital share (p)		7		84.5p		1680.5p		1765.0p		71.4p		842.9p		914.3p

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.

CONSOLIDATED AND PARENT COMPANY BALANCE SHEETS
as at 31st December 2013

				Company				Group
		Notes		2013 £		2012 £		2013 £		2012 £
Non-current assets
Goodwill		8		-		-		65,191		65,191
Investments - Fair value through profit or loss		10		118,216,321		77,483,097		117,784,849		77,051,625
				118,216,321		77,483,097		117,850,040		77,116,816
Current assets
Trading investments				-		-		772,828		646,584
Trade and other receivables		13		381,850		351,408		617,202		381,015
Current tax receivable				81,214		51,197		-		-
Amounts due from Group undertakings				1,204,259		843,802		-		-
Cash and cash equivalents				4,005,343		7,767,161		4,564,412		8,476,315
				5,672,666		9,013,568		5,954,442		9,503,914
Total assets				123,888,987		86,496,665		123,804,482		86,620,730
Current liabilities
Trade and other payables		14		61,917		65,557		98,508		310,718
Current tax payable				-		-		-		-
				61,917		65,557		98,508		310,718
Total assets less current liabilities				123,827,070		86,431,108		123,705,974		86,310,012
Net assets				123,827,070		86,431,108		123,705,974		86,310,012
Equity
Called up share capital		15		1,225,000		1,225,000		1,225,000		1,225,000
Share premium account		16		225,326		225,326		225,326		225,326
Retained reserves:
Capital reserve		16		51,796,430		49,005,514		51,796,430		49,005,514
Revaluation reserve		16		68,252,472		34,297,306		68,252,472		34,297,306
Dividend equalisation reserve		16		2,327,842		1,677,962		2,206,746		1,556,866
Total equity				123,827,070		86,431,108		123,705,974		86,310,012
Net asset value per share
Income shares		17						1334.0p		935.0p
Capital shares		17						5529.9p		3848.1p

The financial statements were approved by the Board and authorised for issue on 13th February 2014. They were signed on its behalf by:

Dr D. M. Bramwell, Director
S. J. B. Knott, Director	Company Registration Number: 736898

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the year ended 31st December 2013

		Share capital		Share premium account		Capital reserve		Revaluation reserve		Dividend equalisation reserve		Total
		£		£		£		£		£		£
Balance at 31st December2011		1,225,000		225,326		41,611,944		23,259,244		1,237,946		67,559,460
Changes in equity for 2012
Profit/(Loss) for the period		-		-		7,393,570		11,038,062		2,117,730		20,549,362
Total recognised income and expense		1,225,000		225,326		49,005,514		34,297,306		3,355,676		88,108,822
Dividends		-		-		-		-		(1,798,810)		(1,798,810)
Balance at 31st December 2012		1,225,000		225,326		49,005,514		34,297,306		1,556,866		86,310,012
Changes in equity for 2013
Profit/(Loss) for the period		-		-		2,790,916		33,955,166		2,707,466		39,453,548
Total recognised income and expense		1,225,000		225,326		51,796,430		68,252,472		4,264,332		125,763,560
Dividends		-		-		-		-		(2,057,586)		(2,057,586)
Balance at 31st December 2013		1,225,000		225,326		51,796,430		68,252,472		2,206,746		123,705,974

COMPANY STATEMENT OF CHANGES IN EQUITY
for the year ended 31st December 2013

		Share capital		Share premium account		Capital reserve		Revaluation reserve		Dividend equalisation reserve		Total
		£		£		£		£		£		£
Balance at 31st December 2011		1,225,000		225,326		41,611,944		23,259,244		1,359,042		67,680,556
Changes in equity for 2012
Profit/(Loss) for the period		-		-		7,393,570		11,038,062		2,117,730		20,549,362
Total recognised income and expense		1,225,000		225,326		49,005,514		34,297,306		3,476,772		88,229,918
Dividends		-		-		-		-		(1,798,810)		(1,798,810)
Balance at 31st December 2012		1,225,000		225,326		49,005,514		34,297,306		1,677,962		86,431,108
Changes in equity for 2013
Profit/(Loss) for the period		-		-		2,790,916		33,955,166		2,707,466		39,453,548
Total recognised income and expense		1,225,000		225,326		51,796,430		68,252,472		4,385,428		125,884,656
Dividends		-		-		-		-		(2,057,586)		(2,057,586)
Balance at 31st December 2013		1,225,000		225,326		51,796,430		68,252,472		2,327,842		123,827,070

CASH FLOW STATEMENTS
for the year ended 31st December 2013

				Company				Group
		Notes		2013 £		2012 £		2013 £		2012 £
Cash flows from operating activities
Profit before tax				39,372,334		20,498,165		39,453,548		20,549,362
Adjustments for:
Losses/(Gains) on investments				(36,746,082)		(18,431,632)		(36,746,082)		(18,431,632)
Purchases of investments		10		(9,151,687)		(4,650,416)		(9,151,687)		(4,650,416)
Proceeds on disposal of investments		10		5,164,545		9,818,860		5,164,545		9,818,860
Movement in trading investments				-		-		(126,244)		3,273
Operating cash flows before movements in working capital				(1,360,890)		7,234,977		(1,405,920)		7,289,447
Decrease/(increase) in receivables				(390,899)		(170,205)		(236,187)		62,640
Increase/(decrease) in payables				(3,640)		24,078		(212,210)		16,013
Net cash from operating activities before income taxes				(1,755,429)		7,088,850		(1,854,317)		7,368,100
Income taxes received/(paid)				51,197		20,616		-		-
Net cash from operating activities				(1,704,232)		7,109,466		(1,854,317)		7,368,100
Cash flows from financing activities Dividends paid				(2,057,586)		(1,798,810)		(2,057,586)		(1,798,810)
Net cash (used in)/from financing activities				(2,057,586)		(1,798,810)		(2,057,586)		(1,798,810)
Net increase/(decrease) in cash and cash equivalents				(3,761,818)		5,310,656		(3,911,903)		5,569,290
Cash and cash equivalents at beginning of year				7,767,161		2,456,505		8,476,315		2,907,025
Cash and cash equivalents at end of year				4,005,343		7,767,161		4,564,412		8,476,315

NOTES

for the year ended 31st December 2013

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 2012 and 31 December 2013. The 2013 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 2013 accounts, on which the report of the auditor is unqualified, will be filed with the Registrar of Companies in due course. The audited accounts for the year ended 31 December 2012 on which the report of the auditor 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:

	2013	2012	2013	2012
	p	p	£	£
Income
Final dividend for the year ended 31st December 2012	18.25	17.00	448,950	418,200
Interim dividend for the year ended 31st December 2013	9.50	8.50	233,700	209,100
Capital
Final dividend for the year ended 31st December 2012	1.3375	1.2750	21,935	20,910
Supplementary dividend for the year ended 31st December 2013	81.8293	68.6829	1,342,001	1,126,400
			2,046,586	1,774,610
Dividends on non-equity shares:
Cumulative preference	5.5%	5.5%	11,000	11,000

The Articles of Association provide for a Supplementary Capital Dividend to Capital Shareholders to be paid.

	2013	2012	2013	2012
	p	p	£	£
Income
Proposed final dividend for the year ended 31st December 2013	20.50	18.25	504,300	448,950
Proposed special dividend for the year ended 31st December 2013	10.00	-	246,000	-
Capital
Proposed final dividend for the year ended 31st December 2013	1.5000	1.3375	24,600	21,935
Proposed special dividend for the year ended 31st December 2013	0.5000	-	8,200	-

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.

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.

	2013	2012	2013	2012
	p	p	£	£
Dividends on equity shares
Income
Interim dividend for the year ended 31st December 2013	9.50	8.50	233,700	209,100
Proposed final and special dividend for the year ended 31st December 2013	30.50	18.25	750,300	448,950
	40.00	26.75
Capital
Supplementary dividend for the year ended 31st December 2013	81.8293	69.4878	1,342,201	1,139,600
Proposed final and special dividend for the year ended 31st December 2013	2.0000	1.3375	32,800	21,935
	83.8293	70.8253	2,358,801	1,774,610

 

END

 

 

FR EASADFESLEFF