Interim Results
Witan Investment Trust PLC
1 August 2002
WITAN INVESTMENT TRUST PLC
HENDERSON GLOBAL INVESTORS
1 August 2002
WITAN INVESTMENT TRUST PLC
Unaudited Interim Results for the Half Year ended 30 June 2002
Financial Highlights (per ordinary share)
(Unaudited) (Unaudited) (Audited )
Half year ended Half year ended Year ended
30 June 2002 30 June 2001 31 December 2001
pence pence pence
Share price 352.5 442.5 391.0
Net asset value 382.6 484.2 429.3
Earnings 5.21 5.13 8.40
Dividends 3.65 3.60 7.95
Performance (per ordinary share)
6 months 12 months
% return % return
Share price (9.85) (20.34)
Net asset value (10.88) (20.98)
Benchmark * (11.69) (19.49)
* The benchmark comprises the FTSE All-Share Index and the FTSE World (ex UK)
Index in the proportion 60:40 (capital change only).
Dividend
An interim dividend of 3.65p (2001: 3.60p) per ordinary share will be paid on 6
September 2002 to shareholders registered on 16 August 2002. The ex-dividend
date will be 14 August 2002.
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WITAN INVESTMENT TRUST PLC
Unaudited Interim Results for the Half Year ended 30 June 2002
The Chairman's Statement:
It is little consolation to shareholders to be told by their Chairman that
during the six month period under review the Trust has outperformed its
benchmark when its net asset value per share has fallen 10.88%. Worse still,
since the end of December 2000 to yesterday (30 July 2002) the fall has been
35.6%.
For the last year we have warned shareholders of a likely further period of
market re-rating, partly due to an increase in perceived equity risk and partly
due to more difficult trading conditions. The recent volatility in markets,
however, has been greatly exaggerated by fears of further exposures of corporate
wrongdoing. Whilst there may have been some massive write-downs of earnings in a
small number of large North American companies, as well as some dilution in
earnings forecasts due to stock options and management greed, there is no
evidence to suggest that shareholder value has been undermined to the extent of
the present market correction.
On the positive side, we expect to see some dividend growth for the year (in the
U.K. it could be about 3%) which, together with our change in accountancy policy
last year, allows us to increase our distribution by a small amount at this
interim stage and hopefully by a further modest amount at the year end.
In the meantime we will continue to manage our gearing and our discount, and
continue to be highly stock selective in what we own.
Lord Faringdon
31 July 2002
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WITAN INVESTMENT TRUST PLC
Unaudited Interim Results for the Half Year ended 30 June 2002
Statement of Total Return (incorporating the revenue account)
for the half year ended 30 June 2002
(Unaudited) (Unaudited) (Audited)
Half year ended Half year ended Year ended
30 June 2002 30 June 2001 31 December 2001
Revenue Capital Total Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Total capital losses
from investments - (163,753) (163,753) - (131,919) (131,919) - (316,911) (316,911)
Income from fixed
asset investments 21,151 - 21,151 20,939 - 20,939 35,894 - 35,894
Other interest
receivable and similar
income 1,024 - 1,024 1,512 - 1,512 2,369 - 2,369
--------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------
Gross revenue and
capital losses 22,175 (163,753) (141,578) 22,451 (131,919) (109,468) 38,263 (316,911) (278,648)
Management fee (509) (1,968) (2,477) (509) (1,526) (2,035) (1,022) (3,065) (4,087)
(note 3)
Other administrative
expenses (1,324) - (1,324) (1,336) - (1,336) (2,645) - (2,645)
--------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------
Net return/(loss) on
ordinary activities
before interest
payable and taxation 20,342 (165,721) (145,379) 20,606 (133,445) (112,839) 34,596 (319,976) (285,380)
Interest payable (1,263) (3,790) (5,053) (1,263) (3,792) (5,055) (2,533) (7,599) (10,132)
--------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------
Net return/(loss) on
ordinary activities
before taxation 19,079 (169,511) (150,432) 19,343 (137,237) (117,894) 32,063 (327,575) (295,512)
Taxation on net
return on ordinary
activities (714) - (714) (1,261) 681 (580) (2,429) 1,514 (915)
(note 4)
--------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------
Net return/(loss) on
ordinary activities
after taxation 18,365 (169,511) (151,146) 18,082 (136,556) (118,474) 29,634 (326,061) (296,427)
Dividends - preference
shares (42) - (42) (42) - (42) (83) - (83)
--------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------
Attributable to the
ordinary shareholders 18,323 (169,511) (151,188) 18,040 (136,556) (118,516) 29,551 (326,061) (296,510)
--------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------
Dividends - ordinary
shares
Interim payment of
3.65p (2001: 3.60p) (12,836) - (12,836) (12,661) - (12,661) (12,654) - (12,654)
Final 2001: 4.35p - - - - - - (15,298) - (15,298)
--------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------
(12,836) - (12,836) (12,661) - (12,661) (27,952) - (27,952)
--------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------
Transfer to/(from)
reserves 5,487 (169,511) (164,024) 5,379 (136,556) (131,177) 1,599 (326,061) (324,462)
========= ========== ========== ========== ========== ========== ========== ========== =========
Return/(loss) per
ordinary share 5.21p (48.20)p (42.99)p 5.13p (38.83)p (33.70)p 8.40p (92.71)p (84.31)p
(notes 1 and 4)
========= ========== ========== ========== ========== ========== ========== ========== =========
The revenue columns of this statement represent the revenue accounts of the
Company.
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WITAN INVESTMENT TRUST PLC
Unaudited Interim Results for the Half Year ended 30 June 2002
Balance Sheet
at 30 June 2002
(Unaudited) (Unaudited) (Audited)
30 June 2002 30 June 2001 31 December 2001
£'000 £'000 £'000
Fixed asset investments
Listed in the United Kingdom (at market value) 807,483 1,009,374 933,538
Listed abroad (at market value) 615,678 763,763 657,787
Unquoted (at directors' valuation) 30,132 38,976 32,586
------------- ------------ ------------
1,453,293 1,812,113 1,623,911
------------- ------------ ------------
Current assets
Debtors 30,734 15,712 6,154
Cash at bank and short term deposits 25,186 53,291 45,931
------------- ------------ ------------
55,920 69,003 52,085
Creditors : amounts falling due within one year (16,879) (31,552) (19,677)
------------- ------------ ------------
Net current assets 39,041 37,451 32,408
------------- ------------ ------------
Total assets less current liabilities 1,492,334 1,849,564 1,656,319
Creditors: amounts falling due after more (144,136) (144,057) (144,097)
than one year
------------ ------------ ------------
Total net assets 1,348,198 1,705,507 1,512,222
======== ======== ========
Capital and reserves
Called-up share capital
Preference shares 2,555 2,555 2,555
Ordinary shares 87,921 87,921 87,921
Share premium 16,237 16,237 16,237
Other capital reserves
Redemption reserve 5,905 5,905 5,905
Capital reserve - realised 1,061,478 1,128,080 1,072,787
Capital reserve - unrealised 148,881 441,295 307,083
Revenue reserve 25,221 23,514 19,734
------------ ------------ ------------
Shareholders' funds (including non-equity 1,348,198 1,705,507 1,512,222
interests of £2,555,000)
======== ======== ========
Net asset value per ordinary share 382.6p 484.2p 429.3p
======== ======== ========
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WITAN INVESTMENT TRUST PLC
Unaudited Interim Results for the Half Year ended 30 June 2002
Cash Flow Statement
for the half year ended 30 June 2002
(Unaudited) (Unaudited) (Audited)
Half year ended Half year ended Year ended
30 June 2002 30 June 2001 31 December 2001
£'000 £'000 £'000
Net cash inflow from operating activities 17,113 18,398 31,543
Net cash outflow from servicing of finance (5,071) (5,074) (10,135)
Net tax recovered 285 392 573
Net cash outflow from financial investment (17,300) (14,550) (17,220)
Equity dividends paid (15,299) (14,947) (27,601)
Management of liquid resources 5,000 (15,000) 5,000
------------ ------------ ------------
Net cash outflow before financing (15,272) (30,781) (17,840)
Net cash outflow from financing - (56) (56)
------------ ------------ ------------
Decrease in cash (15,272) (30,837) (17,896)
------------ ------------ ------------
Reconciliation of operating revenue to net cash inflow from operating activities
Net revenue before interest payable and taxation 20,342 20,606 34,596
(Increase)/decrease in accrued income (703) 623 1,434
(Increase)/decrease in debtors (33) (22) 26
Increase/(decrease) in creditors 399 (176) 129
Management expenses charged to capital (1,968) (1,526) (3,065)
Tax deducted at source (924) (982) (1,390)
Scrip dividends included in investment income - (125) (187)
------------ ------------ ------------
17,113 18,398 31,543
------------ ------------ ------------
Reconciliation of net cash flow to movement in net debt
Decrease in cash as above (15,272) (30,837) (17,896)
Cash (inflow)/outflow from management of liquid resources (5,000) 15,000 (5,000)
Cash outflow from debt financing - 56 56
------------ ------------ ------------
Change in net debt resulting from cash flows (20,272) (15,781) (22,840)
Exchange movements (473) (529) (830)
Increase in valuation of debt (39) (110) (150)
------------ ------------ ------------
Movement in net debt in the period (20,784) (16,420) (23,820)
Net debt at the beginning of the period (98,166) (74,346) (74,346)
------------ ------------ ------------
Net debt at the end of the period (118,950) (90,766) (98,166)
------------ ------------ ------------
Represented by:
Bank balances and short term deposits 25,186 53,291 45,931
Debt falling due after more than one year (144,136) (144,057) (144,097)
------------ ------------ ------------
(118,950) (90,766) (98,166)
------------ ------------ ------------
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WITAN INVESTMENT TRUST PLC
Unaudited Interim Results for the Half Year ended 30 June 2002
Notes
1. Return/(loss) per ordinary share
The revenue return per ordinary share is based on the earnings attributable
to the ordinary shares of £18,323,000 (half year ended 30 June 2001:
£18,040,000; year ended 31 December 2001: £29,551,000) and on the weighted
average number of ordinary shares of 25p each in issue during the period of
351,682,244 (half year ended 30 June 2001 and year ended 31 December 2001:
351,682,244).
The capital return per ordinary share is based on the net capital losses of
£169,511,000 (half year ended 30 June 2001 £136,556,000; year ended 31
December 2001: £326,061,000) and on the weighted average number of ordinary
shares in issue, as stated above.
2. Issue share capital
At 30 June 2002 there were 351,682,244 ordinary shares in issue (30 June
2001 and 31 December 2001: 351,682,244).
3. Performance fee
The total management fee for the half year ended 30 June 2002
includes an accrual of £441,000 (inclusive of irrecoverable VAT) for a
performance fee. This reflects the performance of the Company's net
asset value per share relative to that of its benchmark over the half
year ended 30 June 2002. A performance fee will crystallise only to the
extent of any outperformance over the full accounting year ending 31
December 2002. The accrued performance fee has been allocated wholly to
capital, reflecting the fact that it is calculated by reference to
capital performance only.
4. Allocation of tax relief
With effect from 1 January 2002, the tax relief available to the
Company on its management, administrative and finance costs is allocated
between revenue and capital according to the 'marginal basis' whereby
revenue expenses are matched first against taxable income arising in the
revenue account; the effect of this is that in the half year ended 30
June 2002 all the tax relief was allocated to revenue. In 2001 the tax
relief was allocated according to the 'proportional basis'. Had the
comparative figures been calculated on the same basis, the revenue
return for the half year ended 30 June 2001 would have been 5.29p rather
than 5.13p (year ended 31 December 2001: 8.77p rather than 8.40p).
5. Dividend
The directors have declared an interim dividend of 3.65p (2001: 3.60p)
per ordinary share, payable on 6 September 2002 to shareholders
registered on 16 August 2002. The shares will be quoted ex-dividend on
14 August 2002.
6. Interim accounts
The interim accounts have been neither audited nor reviewed by the auditors.
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WITAN INVESTMENT TRUST PLC
Unaudited Interim Results for the Half Year ended 30 June 2002
7. Comparative information
The figures and financial information for the year ended 31 December
2001 are extracted from the latest published accounts and do not
constitute statutory accounts for that year. Those accounts have been
delivered to the Registrar of Companies and included the report of the
auditors which was unqualified and did not contain a statement under
either section 237(2) or 237(3) of the Companies Act 1985.
8. Interim Report
The interim report will be sent to shareholders in August 2002 and
copies will be available thereafter from the Secretary at the Company's
registered office, 4 Broadgate, London EC2M 2DA.
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For further information, please contact:
James Robinson
Witan Investment Trust plc
Tel: 020 7818 4312
James Budden
Witan Investment Trust plc
Tel: 020 7818 3121
Gordon Puckey
Quill Communications
Tel: 020 7763 6970
END
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