for the six months ended 30th June 2014
The first half of 2014 has been much quieter with the FTSE All-Share Index registering a fall of -0.3%.
The Trust progressed with a 3.2% rise in the net asset value of the capital shares to 5708.8p. The Trust benefited as smaller companies again outperformed their larger peers.
During the six months, the repurchase of the Preference Class was completed at a cost of
£250,000, not including professional expenses.
The interim dividend is being increased to 10.5p per income share. The capital progress achieved by the Trust in recent years continues to generate income improvements.
The current indecision of the stock market is a product of the competing forces which it faces. The UK economy is undoubtedly recovering but valuations are already high and interest rate rises will follow. Competitive pressures can also suddenly intensify to the detriment of corporate profitability. Still, it is encouraging to see the solid operating performances achieved by so many of the Trust's major investments.
Chairman
July 2014
You can view or download copies of the Half Year and Annual reports from our website at www.rightsandissues.co.uk.
The Half Yearly Report is to be posted to shareholders and is available at the registered office of the Company.
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 the Company's performance over the remaining six months of the financial year and could cause actual results to differ materially from expected and historical results. The Company's results continue to be exposed to the risk of market price. Further information on the principal long-term risks and uncertainties of the Company is included in the latest annual report.
for the six months ended 30th June 2014
Six months ended 30th June 2014
|
Revenue |
Capital |
Total |
||
£ |
£ |
£ |
|||
Investment income |
1,492,429 |
|
- |
|
1,492,429 |
Other operating income |
198,490 |
|
- |
|
198,490 |
Total income |
1,690,919 |
|
- |
|
1,690,919 |
Gains/(Losses) on fair value
through profit or loss assets |
20,429 |
|
3,931,346 |
|
3,951,775 |
1,711,348 |
|
3,931,346 |
|
5,642,694 |
|
Expenses Investment management fee |
- |
|
- |
|
- |
Other expenses |
360,418 |
|
- |
|
360,418 |
|
360,418 |
|
- |
|
360,418 |
Profit before tax Tax |
1,350,930 - |
|
3,931,346 - |
|
5,282,276 - |
Profit for the period |
1,350,930 |
|
3,931,346 |
|
5,282,276 |
Earnings per share |
|
|
|
|
|
Return per income share (p) |
23.3p |
|
39.9p |
|
63.2p |
Return per capital share (p) |
44.3p |
|
179.8p |
|
224.1p |
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 and there are no minority interests.
The interim dividend of 10.5p net (2013: 9.5p net) per income share and amounting to £258,300 (2013:
£233,700) is payable on 30th September 2014 to shareholders on the register as at 29th August 2014. 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 2013 Year ended 31st December 2013
Revenue £ |
|
Capital £ |
Total £ |
|
Revenue £ |
Capital £ |
Total £ |
1,456,043 |
|
- |
1,456,043 |
|
2,869,243 |
- |
2,869,243 |
158,030 |
|
- |
158,030 |
|
340,063 |
- |
340,063 |
1,614,073 |
|
- |
1,614,073 |
|
3,209,306 |
- |
3,209,306 |
34,999 |
|
8,430,299 |
8,465,298 |
|
237,002 |
36,746,082 |
36,983,084 |
1,649,072 |
|
8,430,299 |
10,079,371 |
|
3,446,308 |
36,746,082 |
40,192,390 |
- |
|
- |
- |
|
- |
- |
- |
331,901 |
|
- |
331,901 |
|
738,842 |
- |
738,842 |
331,901 |
|
- |
331,901 |
|
738,842 |
- |
738,842 |
1,317,171 |
|
8,430,299 |
9,747,470 |
|
2,707,466 |
36,746,082 |
39,453,548 |
- |
|
- |
- |
|
- |
- |
- |
1,317,171 |
|
8,430,299 |
9,747,470 |
|
2,707,466 |
36,746,082 |
39,453,548 |
25.2p |
|
85.7p |
110.9p |
|
53.3p |
373.4p |
426.7p |
42.2p |
|
385.5p |
427.7p |
|
84.5p |
1680.5p |
1765.0p |
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 30th June 2014 and 30th June 2013 has not been audited.
The information for the year ended 31st December 2013 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) or (4) of the Companies Act 2006.
The auditors have reviewed the financial information for the six months ended 30th June 2014 pursuant to the Auditing Practices Board guidance on Review of Interim Financial Information.
as at 30th June 2014
|
30th June 2014 £ |
|
30th June 2013 £ |
|
31st December 2013 £ |
Non-current assets Goodwill |
65,191 |
|
65,191 |
|
65,191 |
Investments - Fair value through profit or loss |
122,314,380 |
|
90,276,847 |
|
117,784,849 |
|
122,379,571 |
|
90,342,038 |
|
117,850,040 |
Current Assets Trading investments |
509,248 |
|
697,007 |
|
772,828 |
Trade and other receivables |
819,059 |
|
745,355 |
|
617,202 |
Cash and cash equivalents |
4,509,908 |
|
4,012,609 |
|
4,564,412 |
|
5,838,215 |
|
5,454,971 |
|
5,954,442 |
Total Assets |
128,217,786 |
|
95,797,009 |
|
123,804,482 |
Current Liabilities Trade and other payables |
971,036 |
|
886,912 |
|
98,508 |
Current tax payable |
- |
|
- |
|
- |
|
971,036 |
|
886,912 |
|
98,508 |
Total assets less current liabilities |
127,246,750 |
|
94,910,097 |
|
123,705,974 |
Net Assets |
127,246,750 |
|
94,910,097 |
|
123,705,974 |
Equity Called up share capital |
1,025,000 |
|
1,225,000 |
|
1,225,000 |
Share premium account Retained reserves: Capital reserve |
225,326
51,973,014 |
|
225,326
50,156,680 |
|
225,326
51,796,430 |
Revaluation reserve |
72,007,234 |
|
41,576,439 |
|
68,252,472 |
Dividend equalisation reserve |
2,016,176 |
|
1,726,652 |
|
2,206,746 |
Total equity |
127,246,750 |
|
94,910,097 |
|
123,705,974 |
Net asset value per share Income shares |
1366.7p |
|
1027.6p |
|
1334.0p |
Capital shares |
5708.8p |
|
4233.6p |
|
5529.9p |
for the six months ended 30th June 2014
Share |
Dividend |
|||||||||||
Share |
premium |
Capital |
Revaluation |
equalisation |
||||||||
capital |
account |
reserve |
reserve |
reserve |
Total |
|||||||
£ |
£ |
£ |
£ |
£ |
£ |
|||||||
For the six months |
||||||||||||
ended June 2013 |
||||||||||||
Balance at |
||||||||||||
31st December 2012 |
1,225,000 |
225,326 |
49,005,514 |
34,297,306 |
1,556,866 |
86,310,012 |
||||||
Profit for the period |
- |
- |
1,151,166 |
7,279,133 |
1,317,171 |
9,747,470 |
||||||
Total recognised income and expense |
1,225,000 |
225,326 |
50,156,680 |
41,576,439 |
2,874,037 |
96,057,482 |
||||||
Dividends |
- |
- |
- |
- |
(1,147,385) |
(1,147,385) |
||||||
Balance at |
||||||||||||
30th June 2013 |
1,225,000 |
225,326 |
50,156,680 |
41,576,439 |
1,726,652 |
94,910,097 |
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Share |
Dividend |
|||||||||||
Share |
premium |
Capital |
Revaluation |
equalisation |
||||||||
capital |
account |
reserve |
reserve |
reserve |
Total |
|||||||
£ |
£ |
£ |
£ |
£ |
£ |
|||||||
For the six months |
||||||||||||
ended June 2014 |
||||||||||||
Balance at |
||||||||||||
31st December 2013 |
1,225,000 |
225,326 |
51,796,430 |
68,252,472 |
2,206,746 |
123,705,974 |
||||||
Profit for the period |
- |
- |
176,584 |
3,754,762 |
1,350,930 |
5,282,276 |
||||||
Total recognised income and expense |
1,225,000 |
225,326 |
51,973,014 |
72,007,234 |
3,557,676 |
128,988,250 |
||||||
Dividends |
- |
- |
- |
- |
(1,491,500) |
(1,491,500) |
||||||
Balance at |
||||||||||||
30th June 2014 |
1,225,000 |
225,326 |
51,973,014 |
72,007,234 |
2,016,176 |
127,246,750 |
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
for the six months ended 30th June 2014
|
Group 2014 |
|
Group 2013 |
£ |
|
£ |
|
Cashflows from operating activities |
|
|
|
Profit before tax |
5,282,276 |
|
9,747,470 |
Adjustments for: |
|
|
|
(Gains)/losses on investments |
(3,931,346) |
|
(8,430,299) |
Purchase of investments |
(1,793,489) |
|
(6,332,704) |
Proceeds of investments |
1,195,304 |
|
1,537,780 |
Movement in trading investments |
263,580 |
|
(50,423) |
Operating cash flows before movements in working capital |
1,016,325 |
|
(3,528,176) |
Decrease/(increase) in receivables |
(201,857) |
|
(364,339) |
Increase/(decrease) in payables |
164,128 |
|
(100,306) |
Net cash from operating activities before income taxes |
978,596 |
|
(3,992,821) |
Income taxes paid |
- |
|
- |
Net cash from operating activities |
978,596 |
|
(3,992,821) |
Cash flows from financing activities |
|
|
|
Preference shares redeemed |
(250,000) |
|
- |
Dividends paid |
(783,100) |
|
(470,885) |
Net cash (used in)/from financing activities |
(1,033,100) |
|
(470,885) |
Net increase/(decrease) in cash and cash equivalents |
(54,504) |
|
(4,463,706) |
Cash and cash equivalents at beginning of year |
4,564,412 |
|
8,476,315 |
Cash and cash equivalents at end of period |
4,509,908 |
|
4,012,609 |
for the six months ended 30th June 2014
1. Accounting Standards
The condensed interim financial report has been prepared in accordance with International Financial Reporting Standards (IFRSs), including IAS 34 "Interim financial reporting" as adopted by the European Union. 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 2014 2013
Amounts recognised as distributions to equity holders in the period:
Income (Paid)
Final dividend for the year ended 31st December 2013
of 20.50p (2012: 18.25p) per share 504,300 448,950
Special dividend for the year ended 31st December 2013
of 10.00p (2012: 00.00p) per share 246,000 -
Capital (Paid)
Final dividend for the year ended 31st December 2013
of 1.50p (2012: 1.3375p) per share 24,600 21,935
Special dividend for the year ended 31st December 2013
of 0.50p (2012: 00.00p) per share Capital Supplementary (Accrued) |
8,200 |
|
- |
Payable 2nd January 2015 of 86.3902p (2014: 81.8293p) per share |
708,400 |
|
671,000 |
Dividends on non-equity shares: Cumulative preference 5.5% (Accrued) |
- |
|
5,500 |
|
1,491,500 |
|
1,147,385 |
Income Proposed interim dividend for the year ended 31st December 2014 of 10.5p (2013: 9.5p) per share |
258,300 |
|
233,700 |
This was approved by the Board on 11th July 2014 and has not been included as a liabilityat 30th June 2014.
3. Income
Total income comprises: Dividends
Interest Other income
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 £198,490 (2013: £158,030) and the amount owed by the Fund at the period end was £27,488 (2013: £27,387).
5. Going concern
The Directors believe that it is appropriate to adopt the going concern basis in preparing the financial statements. The assets of the Company consist mainly of securities that are readily realisable and, accordingly, the Company has adequate financial resources to continue in
operational existence for the foreseeable future. 7
The Directors are responsible for preparing the half yearly financial report in accordance with applicable law and regulations.
The Directors confirm that to the best of their knowledge:
• the condensedset of financial statements has been prepared in accordance with IAS 34 "Interimfinancial reporting"; and
• the half yearly management report includesa fair review of the information required by DTR 4.2.7R and 4.2.8R.
This report was approved on 11th July 2014.
Chairman
Holding |
Investment |
Value £ |
10,425,000 |
Scapa Group |
13,265,813 |
2,700,000 |
Brammer |
12,318,750 |
1,800,000 |
VP |
12,159,000 |
1,625,000 |
RPC Group |
10,180,625 |
5,775,000 |
Treatt |
9,990,750 |
2,050,000 |
Colefax Group |
7,585,000 |
1,434,230 |
Hill & Smith Holdings |
7,214,777 |
15,659,184 |
Macfarlane Group |
5,989,638 |
8,480,000 |
Renold |
5,384,800 |
764,325 |
British Polythene Ind |
4,983,399 |