Interim Results

Value & Income Trust plc 30 October 2007 VALUE AND INCOME TRUST PLC UNAUDITED HALF-YEARLY FINANCIAL REPORT FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2007 SUMMARY Six months ended Six months ended Year ended 30 September 2007 30 September 2006 31 March 2007 Net Asset Value per Share 261.9p 240.5p 271.1p (valuing debt at market) Net Asset Value per Share 287.9p 272.7p 299.0p (valuing debt at par) Share Price 237.3p 220.0p 253.0p Earnings per Share 4.8p 4.2p 6.8p Dividend per Share 3.7p 3.2p 6.7p (Interim) (Interim) (Total) Over the half-year VIT's share price fell 6.2% while the net asset value, valuing debt at par, fell by 3.7%.The FTSE All-Share Index increased by 1% over the half-year, in capital terms. VIT's property portfolio was revalued independently at 30 September 2007 and the capital value had declined by 1.3% compared to 31 March 2007. An interim dividend of 3.7p has been declared payable on 11 January 2008 to those shareholders on the register on 14 December 2007 with a related ex-dividend date of 12 December 2007. In the absence of unforeseen circumstances the Directors expect to recommend to shareholders the approval of a final dividend of a further 3.7p per share for the year ended 31 March 2008 which would take total dividends for the full year to 7.4p per share (+10.4%). Enquiries: Matthew Oakeshott or Angela Lascelles OLIM Limited, Investment Managers Tel: 0207 439 4400 / Fax: 0207 734 1445 Website: www.olim.co.uk INTERIM MANAGEMENT REPORT Events during the period At the Company's Annual General Meeting on 5 July 2007, all resolutions were passed. At the period end the following shareholders had notified the Company of their holdings: Shareholder Number of Ordinary shares % of Ordinary Shares held held (with voting rights attaching) Legal & General Group PLC 1,475,777 3.2 Risks and Uncertainties The Board has identified the key risks that affect its business as follows which are considered equally applicable to the second half of the financial year to 31 March 2008 as for the half-year under review: â€¢ Market price risk: Changes in interest rates, valuations accorded to financial instruments and movements thereof, and the liquidity of financial instruments constitute market price risk. It is the Board's policy to hold an appropriate spread of investments in the portfolio in order to reduce the risk arising from factors specific to any particular sector. Market price risk is managed through investment guidelines agreed by the Board with the Manager and is discussed at each Board meeting. â€¢ Gearing risk: The Group's policy is to increase its exposure to equity and property markets through the judicious use of borrowings. When borrowings are invested in such markets, the effect is to magnify the impact on shareholders' funds of changes, both positive and negative, in the value of the portfolio. The Group's borrowings providing secure long term funding are long term debenture stocks maturing in 2021 and 2026. The debenture stocks are valued at amortised cost in the financial statements. The Manager regulates the overall level of gearing by raising or lowering cash balances. â€¢ Credit risk: The Group places funds with authorised deposit takers from time to time and is therefore potentially at risk from the failure of any such institution of which it is a creditor. Amounts of such funds at the balance sheet date are shown on the balance sheet as 'Cash and cash equivalents'. â€¢ Liquidity risk: The Group's assets comprise of readily realisable securities which can be sold to meet commitments if required and investment properties which, by their nature, are rather less readily realisable. Directors' Responsibilities The Directors confirm that to the best of their knowledge: â€¢ the condensed set of financial statements within the Half-Yearly Financial Report has been prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting'; and â€¢ the interim board report includes a fair review of the information required by 4.2.7R and 4.2.8R of the FSA's Disclosure and Transparency Rules. For Value and Income Trust PLC James Ferguson Chairman 30 October 2007 VALUE AND INCOME TRUST PLC GROUP INCOME STATEMENT FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2007 6 months ended 6 months ended 30 September 2007 30 September 2006 (Unaudited) (Unaudited) Revenue Capital Total Revenue Capital Total Â£'000 Â£'000 Â£'000 Â£'000 Â£'000 Â£'000 INVESTMENT INCOME Dividend income 2,638 - 2,638 2,381 - 2,381 Interest income 80 - 80 79 - 79 OTHER OPERATING INCOME 1,660 - 1,660 1,590 - 1,590 _________ _________ _________ _________ _________ _________ TOTAL INCOME 4,378 - 4,378 4,050 - 4,050 GAINS AND LOSSES ON INVESTMENTS Realised gains on - 4,337 4,337 - 4,657 4,657 held-at-fair-value investments Unrealised gains/(losses) on - (10,086) (10,086) - 1,310 1,310 investments _________ _________ _________ _________ _________ _________ TOTAL REVENUE 4,378 (5,749) (1,371) 4,050 5,967 10,017 _________ _________ _________ _________ _________ _________ EXPENSES Investment management fees (203) (475) (678) (174) (407) (581) Other operating expenses (241) - (241) (232) - (232) FINANCE COSTS (1,751) - (1,751) (1,751) - (1,751) _________ _________ _________ _________ _________ _________ TOTAL EXPENSES (2,195) (475) (2,670) (2,157) (407) (2,564) _________ _________ _________ _________ _________ _________ PROFIT BEFORE TAX 2,183 (6,224) (4,041) 1,893 5,560 7,453 TAXATION - 590 590 - (413) (413) _________ _________ _________ _________ _________ _________ PROFIT FOR THE PERIOD 2,183 (5,634) (3,451) 1,893 5,147 7,040 _________ _________ _________ _________ _________ _________ EARNINGS PER ORDINARY SHARE 4.79 (12.37) (7.58) 4.16 11.30 15.46 (PENCE) DIVIDENDS PER ORDINARY SHARE 3.70 3.20 (PENCE) The total column of this statement represents the Group's Income Statement prepared in accordance with IFRS. The supplementary revenue return and capital return columns are both prepared under guidance issued 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. VALUE AND INCOME TRUST PLC GROUP INCOME STATEMENT (Cont'd) Year ended 31 March 2007 (Audited) Revenue Capital Total Â£'000 Â£'000 Â£'000 INVESTMENT INCOME Dividend income 4,010 - 4,010 Interest income 174 - 174 OTHER OPERATING INCOME 3,196 - 3,196 __________ __________ __________ TOTAL INCOME 7,380 - 7,380 GAINS AND LOSSES ON INVESTMENTS Realised gains on held-at-fair-value investments - 9,073 9,073 Unrealised gains/(losses) on investments - 10,363 10,363 __________ __________ __________ TOTAL REVENUE 7,380 19,436 26,816 __________ __________ __________ EXPENSES Investment management fees (366) (1,361) (1,727) Other operating expenses (409) - (409) FINANCE COSTS (3,502) - (3,502) __________ __________ __________ TOTAL EXPENSES (4,277) (1,361) (5,638) __________ __________ __________ PROFIT BEFORE TAX 3,103 18,075 21,178 TAXATION - (713) (713) __________ __________ __________ PROFIT FOR THE PERIOD 3,103 17,362 20,465 __________ __________ __________ EARNINGS PER ORDINARY SHARE (PENCE) 6.81 38.12 44.93 DIVIDENDS PER ORDINARY SHARE (PENCE) 6.40 VALUE AND INCOME TRUST PLC STATEMENT OF CHANGES IN EQUITY for the 6 months ended 30 September 2007 6 months ended 30 September 2007 Year ended 31 March 2007 (Unaudited) (Audited) Share Share Retained Total Share Share Retained Total capital premium earnings capital premium earnings Â£'000 Â£'000 Â£'000 Â£'000 Â£'000 Â£'000 Â£'000 Â£'000 Net assets at 31 March 2007 4,555 18,446 113,189 136,190 4,555 18,446 95,685 118,686 Net profit for the period - - (3,451) (3,451) - - 20,465 20,465 Dividends paid - - (1,594) (1,594) - - (2,961) (2,961) _______ ________ _______ _______ _______ _______ _______ _______ NET ASSETS AT 30 SEPTEMBER 2007 4,555 18,446 108,144 131,145 4,555 18,446 113,189 136,190 _______ ________ _______ _______ _______ _______ _______ _______ VALUE AND INCOME TRUST PLC STATEMENT OF CHANGES IN EQUITY (Cont'd) Group 6 months ended 30 September 2006 (Unaudited) Share Share Retained Total capital premium earnings Â£'000 Â£'000 Â£'000 Â£'000 Net assets at 31 March 2007 4,555 18,446 95,685 118,686 Net profit for the period - - 7,040 7,040 Dividends paid - - (1,503) (1,503) _________ _________ _________ _________ NET ASSETS AT 30 SEPTEMBER 2007 4,555 18,446 101,222 124,223 _________ _________ _________ _________ VALUE AND INCOME TRUST PLC GROUP BALANCE SHEET as at 30 September 2007 As at As at As at 30 September 31 March 30 September 2007 2007 2006 (Unaudited) (Audited) (Unaudited) Â£'000 Â£'000 Â£'000 Â£'000 Â£'000 Â£'000 ASSETS NON CURRENT ASSETS Investments held at fair value through 112,225 118,716 105,239 profit or loss Investment properties held at fair value 53,825 54,525 54,725 through profit or loss ________ ________ ________ 166,050 173,241 159,964 CURRENT ASSETS Cash and cash equivalents 5,061 2,266 2,996 Other receivables 498 1,556 1,419 ________ ________ ________ 5,559 3,822 4,415 ________ ________ ________ TOTAL ASSETS 171,609 177,063 164,379 CURRENT LIABILITIES Other payables (2,244) (2,051) (1,623) ________ ________ ________ 169,365 175,012 162,756 NON-CURRENT LIABILITIES Debenture stock (35,456) (35,468) (35,480) Deferred tax (2,764) (3,354) (3,053) ________ ________ ________ (38,220) (38,822) (38,533) ________ ________ ________ 131,145 136,190 124,223 ________ ________ ________ EQUITY ATTRIBUTABLE TO EQUITY HOLDERS Ordinary called up share capital 4,555 4,555 4,555 Share premium 18,446 18,446 18,446 Retained earnings 108,144 113,189 101,222 ________ ________ ________ 131,145 136,190 124,223 ________ ________ ________ NET ASSET VALUE PER ORDINARY SHARE 287.91p 298.99p 272.72p VALUE AND INCOME TRUST PLC GROUP CASH FLOW STATEMENT for the 6 months ended 30 September 2007 6 months ended 6 months ended Year ended 30 September 30 September 31 March 2007 2006 2007 (Unaudited) (Unaudited) (Audited) Â£'000 Â£'000 Â£'000 Â£'000 Â£'000 Â£'000 CASH FLOWS FROM OPERATING ACTIVITIES Dividend income received 2,778 2,372 3,903 Rental received 1,480 1,272 3,117 Interest received 81 79 174 Operating expenses paid (1,419) (1,231) (2,020) ________ ________ ________ NET CASH INFLOW FROM OPERATING ACTIVITIES 2,920 2,492 5,174 CASH FLOWS FROM INVESTING ACTIVITIES Purchase of investments (8,749) (15,947) (28,207) Sale of investments 11,981 17,612 29,680 ________ ________ ________ NET CASH INFLOW FROM INVESTING ACTIVITIES 3,232 1,665 1,473 CASH FLOW FROM FINANCING ACTIVITIES Interest paid (1,763) (1,763) (3,525) Dividends paid (1,594) (1,503) (2,961) ________ ________ ________ NET CASH USED IN FINANCING ACTIVITIES (3,357) (3,266) (6,486) ________ ________ ________ NET INCREASE IN CASH AND CASH EQUIVALENTS 2,795 891 161 Cash and cash equivalents at the start of the 2,266 2,105 2,105 period ________ ________ ________ CASH AND CASH EQUIVALENTS AT THE END OF THE 5,061 2,996 2,266 PERIOD ________ ________ ________ VALUE AND INCOME TRUST PLC NOTES TO THE FINANCIAL STATEMENTS (1) Accounting policies (a) The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) which comprise standards and interpretations approved by the International Accounting Standards Board (IASB) and International Accounting Standards and Standing Interpretations Committee interpretations approved by the International Accounting Standards Committee (IASC) that remain in effect, and to the extent that they have been adopted by the European Union. The financial statements have been prepared on the historical cost basis, except for the revaluation of certain financial assets. Where presentational guidance set out in the Statement of Recommended Practice (SORP) for investment trusts issued by the Association of Investment Companies (AIC) in January 2003 is consistent with the requirements of IFRS, the directors have sought to prepare the financial statements on the basis compliant with the recommendations of the SORP. (b) Dividends payable Interim dividends are recognised as a liability in the period in which they are declared by the board of directors and paid as no further approval is required in respect of such dividends. Final dividends are recognised as a liability only after they have been approved by shareholders. (c) Investments All investments have been designated upon initial recognition as fair value though profit or loss. Investments are recognised and derecognised on the trade date where a purchase or sale is under a contract whose terms require delivery within the timeframe established by the market concerned, and are initially measured at fair value. Investments designated as at fair value are measured at subsequent reporting dates at fair value, which is either the bid price or the last traded price, depending on the convention of the exchange on which the investment is quoted. In respect of property investments, fair value is established by a half-yearly professional valuation on an open market basis by King Sturge and Co, Chartered Surveyors and Valuers and in accordance with the RICS Appraisal and Valuation Manual. Gains and losses arising from changes in fair value are included in net profit or loss for the period as a capital item in the income statement and are ultimately recognised in the retained earnings. (2) Return per ordinary share The return per ordinary share is based on the following figures: 6 months ended 6 months ended Year ended 30 September 2007 30 September 2006 31 March 2007 Â£'000 Â£'000 Â£'000 Revenue return 2,183 1,893 3,103 Capital return (5,634) 5,147 17,362 Weighted average ordinary shares in issue 45,549,975 45,549,975 45,549,975 Return per share - revenue 4.79p 4.16p 6.81p Return per share - capital (12.37p) 11.30p 38.12p _________ _________ _________ Total return per share (7.58p) 15.46p 44.93p _________ _________ _________ 6 months ended 6 months ended Year ended September 2007 September 2006 March 2007 (3) Dividends paid Â£'000 Â£'000 Â£'000 Ordinary dividends on equity shares deducted from reserves are as follows:- Dividends on ordinary shares: Final dividend of 3.5p per share (2006 - 3.3p) 1,594 1,503 1,503 paid 12 July 2007 Interim dividend of 3.2p per share (2006 - 3.1p) - - 1,458 paid 5 January 2007 ____________ ____________ ____________ 1,594 1,503 2,961 ____________ ____________ ____________ (4) Interim dividend The Directors have declared an interim dividend of 3.7p (2007 - 3.2p) per ordinary share, payable on 11 January 2008 to shareholders registered on 14 December 2007. The shares will be quoted ex- dividend on 12 December 2007. (5) Retained earnings The table below shows the movement in the retained earnings analysed between revenue and capital items. Revenue Capital Total Â£'000 Â£'000 Â£'000 At 31 March 2007 2,850 110,339 113,189 Movement during the period:- Profit for the period 2,183 (5,634) (3,451) Dividends paid on ordinary shares (1,594) - (1,594) ________ ________ ________ At 30 September 2007 3,439 104,705 108,144 ________ ________ ________ 6 months 6 months Year ended ended ended September September March 2007 2006 2007 Â£'000 Â£'000 Â£'000 Transaction costs Incurred during the period were transaction costs of:- Purchases 60 99 181 Sales 16 32 50 ________ ________ ________ 76 131 231 _________ _________ _________ (7) Comparative information The financial information in this Half-Yearly Financial Report comprises non-statutory financial statements within the meaning of s240 of the Companies. The financial information for the year ended 31 March 2007 has been extracted from published audited financial statements Act 1985 that have been delivered to the Registrar of Companies. The report of the auditors on those financial statements was unqualified under Section 235 of the Companies Act 1985. This Half-Yearly Financial Report has not been audited. (8) Interim Report The Interim Report will be issued to shareholders in November 2007 and copies may be obtained from the Manager, OLIM Limited, Pollen House, 10/12 Cork Street, London W1S 3NP (Tel. 020 7439 4400) or by download from the Trust's section of the Manager's website - www.olim.co.uk or from the Company Secretary, Edinburgh Fund Managers PLC, Donaldson House, 97 Haymarket Terrace, Edinburgh, EH12 5HD. This information is provided by RNS The company news service from the London Stock Exchange

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