Half Yearly Report

RNS Number : 9296P

Rights and Issues Inv Trust PLC

26 July 2010

 



HALF YEARLY MANAGEMENT REPORT

for the six months ended 30th June 2010

CHAIRMAN'S STATEMENT

The strong recovery in the UK equity market following the recession came to an end in the first six months of 2010 as economic concerns returned. In particular, the difficulties of the Euro zone have focused attention on the fragility of public finances. The fall of 7.9% in the FTSE All-Share reflects the change in sentiment.

Despite this weaker background, the net asset value of the capital shares has recovered by a further 8.4% to 2339.3p. Smaller company shares have performed a little better and the Trust has benefitted from a high level of take-over activity including the recent cash offer for Intelek.

The interim dividend of 8.5p per income share has been maintained. The Trust remains on target to re-establish dividend cover by 2013.

The new UK government is now cutting public expenditure and it remains to be seen how this along with the rise in VAT to 20% will impact the fragile UK recovery.

After 27 years, I have decided to step down as Chairman later in 2010. This will therefore be my last report to shareholders and I expect the Trust to continue its good long-term performance in the future.

Simon Knott

Chairman

July 2010

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 half yearly 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.

There are a number of potential risks and uncertainties which could have a material impact on Trust's performance over the remaining six months of the financial year and could cause actual results to differ materially from expected and historical results. Recent volatility in the stock market and in financial markets has added to uncertainty. The Trust's results continue to be exposed to the risk of market price. Further information on the principal long-term risks and uncertainties of the Trust is included in the latest annual report.

CONDENSED CONSOLIDATED INCOME STATEMENT

for the six months ended 30th June 2010

	Six months ended 30th June 2010
	Revenue		Capital		Total
	£		£		£
Investment income	782,950		-		782,950
Other operating income	124,433		-		124,433
Total income	907,383		-		907,383
Gains/(Losses) on fair value
through profit or loss assets	1,192		3,978,195		3,979,387
	908,575		3,978,195		4,886,770
Expenses
Investment management fee	-		-		-
Other expenses	253,213		-		253,213
	253,213		-		253,213
Profit before tax	655,362		3,978,195		4,633,557
Tax	-		-		-
Profit for the period	655,362		3,978,195		4,633,557
Earnings per share
Return per income share (p)	3.4p		40.4p		43.8p
Return per capital share (p)	34.5p		181.9p		216.4p

The total column of this statement represents the Group's Income Statement, prepared in accordance with IFRSs. All income is attributable to the equity holders of the parent company and there are no minority interests. All items in the above statement derive from continuing operations.

The interim dividend of 8.5p net (2009: 8.5p net) per income share and amounting to £209,100 (2009: £209,100) is payable on 30th September 2010 to shareholders on the register as at 27th August 2010. The sum accruing by way of dividend to the Capital shareholders will, in view of the small sum involved be included in the final dividend.

Six months ended 30th June 2009						Year ended 31st December 2009
Revenue		Capital		Total		Revenue		Capital		Total
£		£		£		£		£		£
556,075		-		556,075		1,337,008		-		1,337,008
113,312		-		113,312		238,092		-		238,092
669,387		-		669,387		1,575,100		-		1,575,100
(19,394)		2,370,843		2,351,449		88,079		11,299,776		11,387,855
649,993		2,370,843		3,020,836		1,663,179		11,299,776		12,962,955
-		-		-		-		-		-
240,569		-		240,569		502,147		-		502,147
240,569		-		240,569		502,147		-		502,147
409,424		2,370,843		2,780,267		1,161,032		11,299,776		12,460,808
-		-		-		-		-		-
409,424		2,370,843		2,780,267		1,161,032		11,299,776		12,460,808
(6.3)p		24.1p		17.8p		0.9p		114.8p		115.7p
34.0p		108.4p		142.4p		68.7p		516.8p		585.5p

The financial information contained in this Half Yearly Financial Report does not constitute statutory accounts as defined in Sections 434 - 436 of the Companies Act 2006. The information for the six months to 30 June 2010 and 30 June 2009 has not been audited.

The information for the year ended 31 December 2009 has been extracted from the latest published audited accounts which have been filed with the Registrar of Companies. The report of the auditors on those accounts contained no qualification or statement under Section 498 (2), (3) or (4) of the Companies Act 2006.

The auditors have reviewed the financial information for the six months ended 30 June 2010 pursuant to the Auditing Practices Board guidance on Review of Interim Financial Information and their report is on page 10.

CONSOLIDATED BALANCE SHEET

as at 30th June 2010

		30th June		30th June		31st December
		2010		2009		2009
		£		£		£
Non-current assets
Goodwill		65,191		65,191		65,191
Investments-Fair value through profit or loss		51,153,636		37,432,888		43,994,057
		51,218,827		37,498,079		44,059,248
Current Assets
Trading investments		502,588		318,650		498,578
Trade and other receivables		186,997		262,149		244,640
Amounts due from group undertakings		-		-		-
Cash and cash equivalents		1,775,145		2,876,077		4,470,403
		2,464,730		3,456,876		5,213,621
Total Assets		53,683,557		40,954,955		49,272,869
Current Liabilities
Trade and other payables		946,667		746,553		161,726
Current tax payable		-		-		-
		946,667		746,553		161,726
Total assets less current liabilities		52,736,890		40,208,402		49,111,143
Net Assets		52,736,890		40,208,402		49,111,143
Equity
Called up share capital		1,225,000		1,225,000		1,225,000
Share premium account		225,326		225,326		225,326
Retained reserves:
Capital reserve		37,890,767		40,751,585		37,150,280
Revaluation reserve		12,454,851		(3,313,095)		9,217,143
Dividend equalisation reserve		940,946		1,319,586		1,293,394
Total equity		52,736,890		40,208,402		49,111,143
Net asset value per share
Income shares		576.13p		459.9p		549.3p
Capital shares		2339.38p		1749.8p		2158.5p

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

for the six months ended 30th June 2010

				Share						Dividend
		Share		premium		Capital		Revaluation		equalisation
		capital		account		reserve		reserve		reserve		Total
		£		£		£		£		£		£
For the six months    ended June 2009
Balance at 31st    December 2008		1,225,000		225,326		40,751,585		(5,683,938)		1,924,122		38,442,095
Profit for the period		-		-		-		2,370,843		409,424		2,780,267
Total recognised    income and expense		1,225,000		225,326		40,751,585		(3,313,095)		2,333,546		41,222,362
Dividends		-		-		-		-		(1,013,960)		(1,013,960)
Balance at 30th June    2009		1,225,000		225,326		40,751,585		(3,313,095)		1,319,586		40,208,402
				Share						Dividend
		Share		premium		Capital		Revaluation		equalisation
		capital		account		reserve		reserve		reserve		Total
		£		£		£		£		£		£
For the six months    ended June 2010
Balance at 31st    December 2009		1,225,000		225,326		37,150,280		9,217,143		1,293,394		49,111,143
Profit for the period		-		-		740,487		3,237,708		655,362		4,633,557
Total recognised    income and expense		1,225,000		225,326		37,890,767		12,454,851		1,948,756		53,744,700
Dividends		-		-		-		-		(1,007,810)		(1,007,810)
Balance at 30th June    2009		1,225,000		225,326		37,890,767		12,454,851		940,946		52,736,890

CONDENSED CONSOLIDATED CASH FLOW STATEMENT

for the six months ended 30th June 2010

		Group		Group
		2010		2009
		£		£
Cashflows from operating activities
Profit before tax		4,633,557		2,780,267
Adjustments for:
(Gains)/losses on investments		(3,978,195)		(2,370,843)
Purchase of investments		(4,101,875)		(79,769)
Proceeds of investments		920,491		-
Movement in trading investments		(4,010)		100,956
Operating cash flows before movements in working capital		(2,530,032)		430,611
Decrease/(increase) in receivables		57,643		(50,596)
Increase/(decrease) in payables		216,241		(89,912)
Net cash from operating activities before income taxes		(2,256,148)		290,103
Income taxes paid		-		-
Net cash from operating activities		(2,256,148)		290,103
Cash flows from financing activities
Dividends paid		(439,110)		(445,260)
Net cash (used in)/from financing activities		(439,110)		(445,260)
Net increase/(decrease) in cash and cash equivalents		(2,695,258)		(155,157)
Cash and cash equivalents at beginning of year		4,470,403		3,031,234
Cash and cash equivalents at end of period		1,775,145		2,876,077

NOTES TO THE CONDENSED HALF YEARLY FINANCIAL REPORT

for the six months ended 30th June 2010

1.	Accounting Standards

The condensed interim financial report has been prepared in accordance with International Financial Reporting Standard (IFRSs), including IAS 34 "Interim financial reporting". The same accounting policies and methods of computation are followed in the interim financial report as those used in the Company's latest published annual financial statements.

2.

Dividends

		2010		2009
	Amounts recognised as distributions to equity holders in the period:
	Income (Paid)
	Final dividend for the year ended 31st December 2009 of 17.0p (2008: 17.0p)    per share	418,200		418,200
	Capital (Paid)
	Final dividend for the year ended 31st December 2009 of 1.2750p (2008: 1.6500p)    per share	20,910		27,060
	Capital Supplementary (Accrued)
	Payable 2nd January 2011 of 68.6829p (2010: 68.6829p) per share	563,200		563,200
	Dividends on non-equity shares:
	Cumulative preference 5.5% (Accrued)	5,500		5,500
		1,007,810		1,356,300
	Income
	Proposed interim dividend for the year ended 31st December 2010 of 8.5p (2009: 8.5p)    per share	209,100		209,100

This was approved by the Board on 26th July 2010 and has not been included as a liability at 30th June 2010.

3.

Income

		2010		2009
	Total income comprises:
	Dividends	782,950		556,075
	Interest	600		3,784
	Other income	123,833		109,528
		907,383		669,387

4.	Related Party Transactions

Transactions between the company and its subsidiaries, which are related parties have been eliminated on consolidation.

The Company's subsidiary company Discretionary Unit Fund Managers Limited manages the Discretionary Unit Fund and acts as principal in respect of all transactions of units in the Fund. In respect of this its fee for the six months amounted to £123,833 (2009: £109,528) and the amount owed by the Fund at the period end was £4,738 (2009: £2,846).

DIRECTORS' STATEMENT OF RESPONSIBILITY FOR THE HALF YEARLY REPORT

The Directors are responsible preparing the half yearly financial report in accordance with applicable law and regulations.

The Directors confirm that to the best of their knowledge:

·	the condensed set of financial statements has been prepared in accordance with IAS 34 "Interim financial reporting"; and

·	the half yearly management report includes a fair review of the information required by DTR 4.2.7R and 4.2.8R.

This report was approved on 26th July 2010.

S. H. J. A. Knott

Chairman

APPENDIX

TOP TEN HOLDINGS

Holding		Investment		Value £
2,700,000		RPS Group		5,035,500
1,673,038		Hill & Smith Holdings		4,977,288
12,500,000		Intelek		3,843,750
2,700,000		Brammer		3,726,000
2,100,000		Colefax Group		3,360,000
1,800,000		VP		3,150,000
15,659,184		Macfarlane Group		2,818,653
1,250,000		Diploma		2,787,500
1,000,000		RPC Group		2,570,000
500,000		Domino Printing Sciences		2,264,500

 

END

 

 

IR LLFLFDDIRFII