Final Results

Glasgow Income Trust PLC 16 November 2007 News Release 16 November 2007 Glasgow Income Trust plc Preliminary Results for the year ended 30 September 2007 Glasgow Income Trust's principal objective is to provide shareholders with a high level of income and to obtain growth in both income and capital over the longer term. The Company is managed by Glasgow Investment Managers Limited, a subsidiary of Aberdeen Asset Management plc. 30 September 2007 30 September 2006 Total Investments £171.4m £125.9m Shareholders' funds £115.1m £87.0m Market capitalisation £111.6m £91.4m Net asset value (NAV) per share 94.4p 92.6p Ordinary share price 91.5p 97.25p (Discount)/Premium (share price to adjusted NAV)* (1.1)% 7.1% Revenue return per share 5.43p 5.31p Dividends per share 5.2015p 5.05p Total expense ratio 1.16% 1.16% Total Gearing 49.0% 44.7% Equity Gearing 6.3% 3.4% * IFRS NAV excluding dividend adjustment of 1.8865p (2006 - 1.81p) • Dividends declared in respect of the year ended 30 September 2007 were 5.2015p, an increase of 3% from 2006. • At the year end the share price was 91.5p, producing a yield of 5.7% compared to the yield on the FTSE All-Share Index, the Company's benchmark, of 2.9%. • The Company increased its net assets in the year to 30 September 2007 to £115.1 million compared to £87.0 million as at 30 September 2006. This was achieved through a combination of positive performance and the issue of 27,957,475 shares. The majority of these shares were issued through a placing and open offer in November 2006 plus the reconstruction of Gartmore High Income Trust plc • The total return on net assets for the year was 7.4% with the total return on the share price being -1.0%. The total return on the FTSE All-Share Index, the Company's benchmark, was 12.2%. For further information please contact: Kirsty Hussain/Graeme McDonald Glasgow Investment Managers 0141 572 2700 Glasgow Income Trust plc Annual Report 30 September 2007 Chairman's Statement Financial Highlights I am pleased to report that in the year to 30 September 2007, the Company's net asset value continued to grow both through positive performance and the issue of shares. The Board has declared dividends totalling 5.2015p in respect of the financial year to 30 September 2007, an increase of 3% from the previous year. This dividend produces a yield of 5.7% at 30 September 2007, significantly higher than the 2.9% yield on the FTSE All-Share Index, the Company's benchmark and the 4.0% on the FTSE 350 Higher Yield Index. The objective of the Company is to provide shareholders with a high level of income and to obtain growth in both income and capital over the longer term. The financial structure is such that by the use of zero coupon finance, while enhancing the revenue account, it puts greater demands on the capital account. Investment Returns The total return on net assets for the year was 7.4% compared to the total return on the FTSE All-Share Index, the Company's benchmark, of 12.2%. Equities were marginally behind the benchmark but given a background of rising interest rates, the fixed interest stocks, predominantly the preference shares, proved a negative to performance. The zero coupon finance also contributed to this underperformance as the total liability increased at an above trend rate due to the recent volatility in credit markets. The Company's share price has enjoyed a premium to net asset value over a substantial period. However at the year end it fell back to a discount of 1.1% and as a result the share price total return was also behind the benchmark at -1.0% for the year. Earnings and Dividends The Board has declared dividends totalling 5.2015p in respect of the financial year to 30 September 2007 which, as mentioned above, is, an increase of 3% from the previous 5.05p. Under International Financial Reporting Standards the dividends accounted for in this report are 5.125p, representing the fourth interim dividend of the 2006 financial year of 1.81p per share together with the first four interim dividends of the 2007 financial year totalling 3.315p per share. The fifth interim dividend of the 2007 financial year of 1.8865p per share paid on 31 October 2007 will be accounted for in the 2008 financial year. Share Capital In the interim report I highlighted the Company had issued 27,957,475 shares in the six month period to 31 March 2007. This was achieved through a placing and open offer in November 2006 and the reconstruction of the Gartmore High Income Trust in December 2006 which allowed their shareholders to roll their investment into Glasgow Income Trust. This rollover was the second time in two years the Company had been selected for such a scheme. In addition there was a further placing of 3,450,000 shares issued in January 2007 and 59,409 shares were issued at prices ranging from 106.0p to 106.5p under the Company's existing blocklisting authority. All of the above issues were at a premium to net asset value. Portfolio Profile and Gearing As disclosed in the interim report the Company took out three new tranches of zero coupon finance totalling £15.1 million in the year to maintain the Company's gearing after the various share issues. The distribution of assets shows that 106.3% of net assets were invested in equities at 30 September 2007, a small rise from the 103.4% invested in equities as at 30 September 2006.Total gearing in the year also rose from 144.7% to 149.0%. Substantially all of the Company's gearing continues to be invested in investment grade corporate bonds and preference shares, and not equities. The bonds, together with the other fixed interest securities in the portfolio, make a major contribution to the high level of income paid by the Company while also allowing a full exposure to the UK equity market. AIC/JP Morgan Claverhouse VAT Test Case The European Court of Justice ("ECJ") opined on the case brought by the AIC and JP Morgan Claverhouse against Her Majesty's Revenue and Customs ("HMRC") on 28 June 2007. This case was regarding whether Value Added Tax ("VAT") should be applied to the management fees of investment trust companies. The ECJ has decided that management fees should be exempt from VAT. We understand that HMRC has now decided not to appeal against this case to the UK VAT Tribunal and therefore protective claims which have been made in relation to the Company will be processed in due course. The Board is currently in the process of quantifying the potential repayment that should be due. However, the amount the Company will receive, the period to which it will refer, and the timescale for receipt are all uncertain and hence the Company has made no provision in these financial statements for any such repayment. Board Mr Martin Griffiths, currently Group Finance Director of Stagecoach Group plc, was appointed to the Board on 8 November 2007. I welcome him and the Board look forward to working with him. In accordance with the Articles of Association, Mr Griffiths requires to be elected at the forthcoming Annual General Meeting. The Board recommends his election. Investment Manager On 24th August 2007 Glasgow Investment Managers Limited, the Company's Managers, were acquired by Aberdeen Asset Managers plc. Aberdeen is a global investment manager and as such, has considerable experience in the investment trust sector. The Board has agreed that Aberdeen will manage the Company going forward and is confident they will be able to build on the success achieved by Glasgow Investment Managers Limited. The Glasgow investment team will be joining the Aberdeen Group to ensure continuity of management. Outlook Since news of the global credit crunch hit markets in the summer, equities have staged a strong recovery. Clearly, the actions of Central Banks to improve liquidity and reduce interest rates in the US are behind the rally. However, there remains an underlying anxiety that over time, the problems encountered by the financial sector could ripple out to the wider economy. The state of the housing market is important to consumer confidence and there is evidence that in some areas the market is slowing. The corporate sector is in a relatively strong financial position as it faces a slow down in economic growth. Private equity involvement in acquisition activity through highly leveraged deals is likely to be reduced. The Board has reviewed income forecasts for the year to 30 September 2008 and, subject to any unforeseen circumstances, hopes to continue with a progressive dividend policy in the forthcoming year. However this should not be taken as a forecast of profits. Annual Report The Annual Report will be mailed to shareholders on 20 November 2007. Copies may be obtained from the managers, Glasgow Investment Managers Limited, Sutherland House, 149 St Vincent Street, Glasgow G2 5DR and Aberdeen Asset Managers plc, Donaldson House, 97 Haymarket Terrace, Edinburgh EH12 5HD after that date. R.G. Hanna, Chairman 16 November 2007 Glasgow Income Trust plc Consolidated Income Statement for the year ended 30 September 2007 2007 2006 Revenue Capital Total Revenue Capital Total Return Return £000 Return Return £000 £000 £000 £000 £000 Gains Gains on investments - 2,645 2,645 - 11,127 11,127 Revenue Dividend Income 4,818, - 4,818 3,338 - 3,338 Interest income from investments 2,169 - 2,169 1,621 - 1,621 Deposit Interest 119 - 119 109 - 109 Traded Options 690 - 690 558 - 558 Other Income 1 - 1 - - - Net (losses)/gains of dealing (52) - (52) 193 - 193 subsidiary 7,745 2,645 10,390 5,819 11,127 16,946 Expenses Investment management fee (519) (519) (1,038) (334) (334) (668) Other administrative expenses (227) - (227) (257) - (257) Finance cost of borrowings (79) (79) (158) (38) (38) (76) Zero Coupon Finance Costs - (2,455) (2,455) - (1,380) (1,380) (825) (3,053) (3,878) (629) (1,752) (2,381) Return before Tax 6,920 (408) 6,512 5,190 9,375 14,565 Tax Expense (589) 179 (410) (540) 112 (428) RETURN ATTRIBUTABLE TO ORDINARY SHAREHOLDERS OF THE COMPANY 6,331 (229) 6,102 4,650 9,487 14,137 Earnings per ordinary share 5.2p 16.2p (pence) *The revenue column of this statement is the consolidated profit and loss account of the Group. All revenue and capital items in the above statement derive from continuing operations. No operations were acquired or discontinued in the year. The financial information set out above and on the following page does not constitute the Company's statutory accounts for the years ended 30 September 2006 and 2007 but is derived from those accounts. Statutory accounts for 2006 have been delivered to the Registrar of Companies and those for 2007 will be delivered following the Company's annual general meeting. The auditors have reported on those accounts; their reports were unqualified and did not contain statements under section 237 (2) or (3) of the Companies Act 1985. Glasgow Income Trust Consolidated & Company Balance Sheets as at 30 September 2007 Group Company 2007 2006 2007 2006 £000 £000 £000 £000 NON CURRENT ASSETS Ordinary shares 122,306 89,955 122,306 89,955 Convertibles 2,194 5,247 2,194 5,247 Corporate bonds 35,339 28,526 35,339 28,526 Other fixed interest 11,576 2,175 11,576 2,175 SECURITIES AT FAIR VALUE 171,415 125,903 171,415 125,903 THROUGH PROFIT OR LOSS Zero coupon finance derivatives at fair value 31,862 12,845 31,862 12,845 Subsidiary - - 5 5 203,277 138,748 203,282 138,753 CURRENT ASSETS Trade and other receivables 12 1,041 478 1,465 Accrued Income and prepayments 2,202 1,792 2,202 1,792 Investments of dealing subsidiary 673 725 - - Cash and cash equivalents 138 102 138 102 3,025 3,660 2,818 3,359 TOTAL ASSETS 206,302 142,408 206,100 142,112 CURRENT LIABILITIES Trade and other payables (714) (1,509) (756) (1,466) Short-term borrowings (422) (400) (422) (400) (1,136) (1,909) (1,178) (1,866) NON CURRENT LIABILITIES Zero coupon finance derivatives at fair value (90,089) (53,491) (90,089) (53,491) TOTAL LIABILITIES (91,225) (55,400) (91,267) (55,357) NET ASSETS 115,077 87,008 114,833 86,755 ISSUED CAPITAL AND RESERVES ATTRIBUTABLE TO ORDINARY SHAREHOLDERS' OF THE PARENT Called up share capital 30,486 23,496 30,486 23,496 Share premium account 53,205 32,715 53,205 32,715 Special reserve 5,000 5,000 5,000 5,000 Retained Earnings Realised capital reserve 17,097 9,080 17,097 9,080 Unrealised capital reserve 5,670 13,916 5,670 13,916 Revenue reserve 3,619 2,801 3,375 2,548 NET ASSETS ATTRIBUTABLE TO 115,077 87,008 114,833 86,755 ORDINARY SHARHOLDERS' Net asset value per ordinary share (pence) 94.4p 92.6p Glasgow Income Trust plc Consolidated & Company Cash Flow Statement for the year ended 30 September 2007 2007 2006 £000 £000 £000 £000 CASH FLOWS FROM OPERATING ACTIVITIES Purchase of Investments (160,450) (54,970) Sale of Investments 117,443 33,287 Zero Coupon Finance 15,126 10,108 (27,881) (11,575) Investment income received 6,776 4,634 Deposit interest received 120 109 Dealing subsidiary receipts - 62 Other cash received 834 553 Administrative expenses paid (1,213) (866) Dealing subsidiary payments - (594) CASH GENERATED FROM OPERATIONS (21,364) (7,677) Interest Paid (151) (83) Taxation (426) (374) NET CASH OUTFLOW FROM OPERATING ACTIVITIES (21,941) (8,134) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds of Issues of shares 27,468 13,599 Equity dividends paid (5,513) (4,152) NET CASH INFLOW FROM FINANCING ACTIVITIES 21,955 9,447 NET INCREASE IN CASH AND CASH EQUIVALENTS 14 1,313 CASH & CASH EQUIVALENTS AT START OF PERIOD (298) (1,611) CASH & CASH EQUIVALENTS AT END OF PERIOD (284) (298) Cash & Cash Equivalents comprise: Cash & Cash Equivalents 138 102 Short Term Borrowings (422) (400) (284) (298) Consolidated Statement of Changes in Equity For the year ended 30 September 2007 Realised Unrealised Retained Share Share Special Capital Capital Revenue Capital Premium Reserve Reserve Reserve Reserve Total £000 £000 £000 £000 £000 £000 £000 As at 30 September 2005 19,726 22,886 5,000 3,981 9,528 2,303 63,424 Revenue profit for the year - - - - - 4,650 4,650 Capital profits for the year - - - 5,099 4,388 - 9,487 Equity dividends - - - - - (4,152) (4,152) Issue of Share Capital 3,770 9,829 - - - - 13,599 As at 30 September 2006 23,496 32,715 5,000 9,080 13,916 2,801 87,008 Revenue profit for the year - - - - - 6,331 6,331 Capital profits for the year - - - 8,017 (8,246) - (229) Equity dividends - - - - - (5,513) (5,513) Issue of Share Capital 6,990 20,490 - - - - 27,480 As at 30 September 2007 30,486 53,205 5,000 17,097 5,670 3,619 115,077 This information is provided by RNS The company news service from the London Stock Exchange

Companies

Troy Income & Growth Trust (TIGT)
UK 100
FTSE quotes by TradingView

Latest directors dealings

All directors dealings today